1951-12-17

Mr. George A. Drew (Leader of the Opposition):: Mr. Speaker, because of the fact that we are obviously approaching the termination of the session, and because it is impossible to raise it in any other way, I propose to raise a matter that I think calls for some statement by the government before we leave. Right across this country a very general feeling of indignation has been expressed in regard to the uncertainty of the future of Kurt Meyer, and I think that before this house leaves we should have a very clear understanding of what is to be done. I think Canadians, without exception, will respect the decisions of our courts, and the decision that may be made in accordance with the ordinary principles of Canadian justice; but there is a strong feeling that there was some connection between the proposal that Kurt Meyer made just before he was arrested, that he be permitted to form a division of S.S. troops to be known as the division Europa, and the course of events which seems to have followed such a strange pattern.
I believe that Kurt Meyer is more than simply another nazi general. He has become a symbol in the minds of Canadians, who have suffered from nazi brutality, of the sort of thing that would raise doubts as to the clarity of our attitude toward conduct of that kind. I think that, at a time when other young men are being called upon to fight for their country, the people of Canada want some reassurance as to exactly what is going to be done in regard to a case that has followed such a strange course up to this time.


Right Hon. L. S. St. Laurent (Prime Minister):: Mr. Speaker, it seems to me rather strange that this should be raised as a matter of privilege. I understand that only matters of privilege can be raised at this stage; but since it has been raised, all I can say to the leader of the opposition is to repeat what has been said. Kurt Meyer is still under the exclusive jurisdiction of the Canadian government, and no decision has been made that would justify the anxiety to which the leader of the opposition referred. There has been no change whatever, other than the transfer of 94699-131
this prisoner to a prison camp in Europe, where he remains, except as to the ordinary administration within the prison camp, under the exclusive jurisdiction of the Canadian government.



PRICE FLUCTUATIONS-REQUEST FOR INVESTIGATION

Mr. P. E. Wright (Melfort):: I wish to raise a matter of privilege. On November 15 I sent across the floor of this house to the Minister of Justice a letter requesting an investigation under chapter 26 of the Revised Statutes of Canada, 1927, with regard to a certain matter under the Combines Investigation Act. The matter had to do with the violent fluctuation in hog prices in this country and the prices at which pork was selling. To date I have had no acknowledgment of the receipt of this letter by the combines investigation commissioner. It is over a month now-the letter was sent across on November 15-and it seems to me that there should be some acknowledgment of this, and some indication as to what action, if any, it is proposed to take.


Hon. Stuart S. Garson (Minister of Justice):: The combines commissioner, as I think can be well understood, has been pretty heavily preoccupied during the interval. I will bring this matter to his attention. I feel confident that action has already been taken on it, but he may have neglected to make an acknowledgment to my hon. friend.



REPORTS AND PAPERS

[Stage Direction]
Annual report of the national film board for the year ended March 31, 1951.-Mr. Winters.

Right Hon. C. D. Howe (Minister of Trade and Commerce):: Mr. Speaker, on September 8, 1950, I advised the house that the Department of Trade and Commerce was preparing an analysis of Canadian investment experience for the last twenty-five years. To meet repeated requests both inside and outside the house for authentic information on the economic growth and industrial expansion of this country, this study, entitled "Private and Public Investment in Canada, 1926 to 1951", has now been completed, and I am tabling a copy. Other copies can be obtained from the distribution office in a day or two.

Questions



INQUIRY FOR RETURN


Hon. Edouard Rinfret (Postmasier General):: Mr. Speaker, on Saturday the hon. member for Winnipeg North Centre (Mr. Knowles) asked that the return to an order dealing with the five-day week be tabled before the close of the present session. This order was referred to departments of the government. There are still four departments to furnish replies and I understand that some of the information is to be supplied by agencies of the government outside Ottawa. It is expected the return will be tabled before the close of the present session.



QUESTIONS


Mr. Brown (Essex West):: 1.	When was the Canadian National Railways station at Windsor, Ontario, erected?
2.	Have there been any major repairs made on the said building since erection?
3.	Has there been any extension made of the said building since erection?
4.	If so, how much has been expended on repairs or extension of the said building by years since 1935?
5.	How many railroad passengers have entered Windsor, Ontario, by Canadian National Railways from January 1. 1945, to date?
6.	How many passengers have left Windsor by Canadian National Railways from January 1, 1945, to date?
7.	What has been the passenger revenue of Canadian National Railways at Windsor, since 1940?
8.	What has been the revenue for hauling freight and express of Canadian National Railways at Windsor, Ontario, since 1940?
9.	Has there been any other revenue obtained by Canadian National Railways since 1940 at Windsor, Ontario? If so, from what source, and how much?


Mr. Benidickson:: The Canadian National Railways advise:
1.	1883.
2.	In 1910 some interior alterations were made to the station and in 1926 an improved heating system was installed.
3.	No.
4.	To answer this question would entail considerable extra work because records of repairs to individual structures are not maintained.
5.	There are no records readily available which would disclose the information necessary to answer this question. The number of passengers entering Windsor could only be determined by counting ticket sales which would involve checking the sales of all agencies for the years concerned.
6.	See answer to No. 5.
7.	Passenger revenue would be determined from the ticket sales and answer to No. 5

explains why this information is not available. In any case, it is not the practice of the company to disclose traffic statistics pertaining to the business transacted at competitive points.
8.	See answer to No. 7.
9.	The railways' accounts are not maintained in a way which makes it possible to extract this information.



RADIOTELEPHONES


Mr. Browne (St. John's West):: 1.	Have any radiotelephones been installed in any part of the province of Newfoundland since July 1, 1951? If so, in what localities?
2.	If not, when will they be ready for installation?


William Moore Benidickson: The Canadian National Railways advise:
1.	No.
2.	It is expected that installation of planned radiotelephones will commence on a progressive basis in about four months' time.



CANADIAN NATIONAL RAILWAYS, EDMUNDSTON, N.B.

Mr. Dube:: 1.	When was the present Canadian National Railways station and freight shed in Edmundston, New Brunswick, built?
2.	How many passengers have left Edmundston, New Brunswick, by the Canadian National Railways since January 1, 1935?
3.	What has been the freight and express revenue of the Canadian National Railways at Edmundston since 1935?


William Moore Benidickson: The Canadian National Railways advise as follows:
1.	The station was built in 1912 with two small extensions; one in 1928 and the other in 1930. The freight shed was also built in 1912 with a 50 ft. extension in 1929.
2.	There are no records readily available which would disclose the information necessary to answer this question. The number of passengers leaving Edmundston could only be determined by counting ticket sales which would involve checking the sales of all agencies for the years concerned.
3.	There are no records readily available which would disclose the information necessary to answer this question. The freight and express revenue of the Canadian National Railways at Edmundston could only be determined by examining the accounts of all agencies for the years concerned. In any case, it is not the practice of the company to disclose traffic statistics pertaining to the business transacted at competitive points.



GEOLOGICAL AND GEODETIC SURVEYS


Mr. Winkler:: 1.	By years, since 1946, how many men were engaged in summer surveys in geology, by federal government agencies in Canada?
2.	By provinces and territories, where were these
surveys made?	.
3.	In the same period, what progress was made in (a) aerial mapping by photography; (b) geodetic survey?


Mr. Prudham:: 1.	Year .. 1946 1947 1948 1949 1950 1951
No. of men 176	194	269	295	350	311
2.	1946, Yukon Territory, Northwest Territories, British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Nova Scotia.
1947,	Yukon Territory, Northwest Territories, British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Nova Scotia, Arctic.
1948,	Yukon Territory, Northwest Territories, British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island.
1949,	Yukon Territory, Northwest Territories, British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Queb c, New Brunswick, Nova Scotia, Arctic, Prince Edward Island, Newfoundland.
1950,	Yukon Territory, Northwest Territories, British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Nova Scotia, Arctic, Prince Edward Island, Newfoundland.
Questions
1951,	Yukon Territory, Northwest Territories, British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Nova Scotia, Arctic, Newfoundland.
3.	(a) Progress made in aerial mapping by photography; air photographs are used in all mapping now being carried on.
Areas covered by air photography since 1946;
Square miles Square miles
	vertical Trimetrogon	
1946 ...	
157,000	187,0001947 ...	
140,000	230,0001948 ...	
386,000	414,0001949 .. .	
378,000	493,0001950 ...	
375,000	450,0001951 ...	
210,000	101,000Total	
1,646,000 1,875,000	Total mapping since 1946: Square miles	1 and 2 mile 1 mile or	4 mile orplanimetric 1/50,000	1/250,000.1946-47	24,300 8,400	10,0001947-48	17,000 10,500	28,0001948-49	25,800 7,700	22,5001949-50	30,000 16,200	69,0001950-51	21,000 27,700	135,400Total	118,100 70,500	264,900
(b) Geodetic survey progress:
Triangulation (visual)
Axial length (miles)	
No. of stations	
Square miles	
Shoran (electronic)
Axial length (miles)	
No. of stations	
Square miles	
Lines measured	
Precise levelling, miles

No. of bench marks	
Astronomic, precise
No. of stations	
Exploratory, No	
Base lines, No	
1946	1947	1948330	275	37037	35	406,090	4,990	6,6501,360	1,065	773387	401	3851	2	445	44	401	2	21949	1950	1951290	400	63537	50	1064,660	6,800	11,230400	700	1,0008	12	2180,000	140,000	360,00028	56	65855	757	771419	349	3663	15	11137	74	81	1	4Note: Triangulation	lines	range	from	20	to	40	miles	in	length.Shoran	lines	range	from	30	to	320	miles	in	length.Base	lines	range	from	4	to	12	miles	in	length.Control of a	lower	or tertiary grade is involved	in	the mapping listed under (a).
2054

Questions



MR. W. C. THOMSON

Mr. Hees:: 1.	What was the total amount of money paid to W. C. Thomson by the Department of Veterans Affairs from January 1, 1945, to date, for (a) services; (b) expenses; (c) disbursements?
2.	Of the above payment, how much was paid for abstracts of title, loan application, or other transactions involving assistance to veterans (a) handled by Mr. Thomson; (b) distributed to agents by Mr. Thomson?


Mr. Mulch:: 1.	(a) $252,760.70; (b) $134.48; (c) $92,722.15.
Note: The above sums include payments
between April 1, 1944, and January 1, 1945, it being impossible to separate the payments in this particular period from those for the whole financial year 1944-45 as the vouchers for the year are not available. For the same reason, it is not possible to distinguish between disbursements and expenses for this period but the amounts in question are a small part of the whole.
2.	The following are payments for transactions involving assistance to veterans for $248,340.70 of the figure of $252,760.70 shown in answer to No. 1 (a):
(a)	Litigations and commissions-handled
by Mr. Thomson: No. of cases, 6; amount, $4,437.90. Legal services relating to titles re land purchased for veterans-handled by Mr. Thomson:	No. of cases, 7,848; amount,

(b)	Legal services relating to titles re land purchased for veterans-distributed to agents by Mr. Thomson: No. of cases, 1,622; amount, $28,385.00.
Note: Due to the vouchers for the fiscal year 1944-45 not being available, the balance of $4,420.00 cannot be broken down as between the cases handled by Mr. Thomson and those distributed to agents.



RAILWAY BRIDGE OVER HILLSBOROUGH RIVER, P. E. I.

Mr. McLure:: 1.	Who owns the condemned railway bridge over the Hillsborough river, Charlottetown to Southport?
2.	To whom will the Prince Edward Island government pay rent for using this bridge for vehicular traffic?


Mr. Benidickson:: 1.	The records of the Department of Transport indicate that the Hillsborough bridge is owned by His Majesty the King in right of Canada.
2.	There is no agreement with the government of Prince Edward Island for paying rent for the use of this bridge for vehicular traffic but the provincial government is obligated
IMr. Prudham.l
under an agreement of April 18, 1900, to contribute annually towards the interest on the cost of the construction and maintenance of the bridge the sum of $9,750.



NEW BRUNSWICK


Mr. Brooks:: 1.	At what places in New Brunswick have recommendations been made for the construction of armouries since 1939?
2.	Where have armouries been constructed since the above date in the province of New Brunswick?
3.	What construction is now contemplated by the Department of National Defence in the said province?
4.	Is there a priority list? If so, state priorities.


Mr. Blancheite:: 1.	Approved recommendations are announced as soon as practicable and since 1939 comprise armouries at Newcastle, N.B.
2.	An armoury is at present under construction at Newcastle. In addition national defence wartime buildings were converted to provide reserve force accommodation at Chatham, Moncton, Saint John and Sussex.
3.	Construction authorized:
Navy, (a) Renous-expansion of Royal Canadian Naval magazine.
Army, (b) McGivney-thirty-six permanent married quarters.
Air. (c) Chatham-aerodrome development and construction of building and facilities, (d) Moncton-construction of buildings and facilities.
4.	No.



BONAVISTA AND CARBONEAR WHARVES, NEWFOUNDLAND

Mr. Browne (St. John's West):: 1.	Who is constructing the wharf at (a) Bona-vista; (b) Carbonear, Newfoundland?
2.	What is the amount involved in each case and what is the manner in which the contractor is to be reimbursed for his services?
3.	Were tenders called for the construction of these wharves?
4.	If so, what were the amounts of tenders received in each case, and which tender was accepted?


Mr. Fournier (Hull):: 1.	(a) Bonavista-North Shore Construction Limited, Montreal, P.Q.
(b) Carbonear-Chester Dawe Ltd., St. John's, Nfld.
2.	Bonavista-Amount of original contract $184,769.40. An additional amount of $26,008.00 was authorized by order in council P.C. 4981 dated September 21, 1951. The contractor is paid 90 per cent of progress

estimate of work, prepared monthly, and the remaining 10 per cent on completion of contract.
Carbonear-Amount of contract $321,540. The contractor is paid 90 per cent of progress estimate of work, prepared monthly, and the remaining 10 per cent on completion of contract.
3.	Yes.
4.	Bonavista-[DOT]
North Shore Construction Ltd. $184,769.40 Diamond Construction Company Ltd	 232,848.00
Concrete Products (Newfoundland) Ltd	 246,617.30
Carbonear-
Chester Dawe Ltd	 $321,540.00
North Shore Construction Ltd. 391,590.00 Concrete Products (Newfoundland) Ltd	 412,650.00
McNamara Construction Co.,
Ltd	 423,125.00
The lowest tender was accepted in each case.



HEALTH GRANTS


Mr. Fulford:: Has any financial assistance been given under the health grants program to the Ontario hospital school at Smiths Falls?


Mr. McCusker:: Yes, a grant of approximately $217,240 has recently been made toward the cost of operating this school to March 31,
1952.



ARMED FORCES DEPENDENTS


Mr. Harkness:: 1.	Have the increases in allowances put through at the last session of parliament, for the children of men killed overseas, been paid if the mother of the child, or children, has since remarried?
2.	If not, what is the reason and the authority for not making the payment?
3.	How many children are affected, and what is the saving to the taxpayer if payment is not made?
4.	What is the number of widows with children who have remarried, and what is the saving to the taxpayer due to their remarriage?


Mr. Mulch:: 1.	All such cases of remarriage are being reviewed. Where need is established, the award for the child or children is increased above the ordinary rate.
2.	The act was amended in June, 1951, and in Bill No. 288, an act to amend the Pension Act, the following explanatory note appears:
The purpose of this amendment is to make more adequate provision for the children of pensioned widows and to increase their awards to correspond to orphan rates which are double the ordinary rates for children.
Questions
A remarried widow is no longer a pensioned widow.
3.	Approximately 3,500; impossible to state as review is still underway.
4.	Approximately 3,200. A pensioned widow receives a bonus of twelve months' pension on remarriage. It is impossible to estimate the saving as the Canadian pension commission cannot determine the life expectancy of the widows.



TELEGRAM RATES

Mr. Poulioi:: What is the actual rate for (a) full rate telegrams: (b) day letters; (c) night messages; (d) night letters, between each one of the provinces compared to the previous rates?


An hon. Member:: Dropped.


Mr. Fournier (Hull):: If the hon. member for Temiscouata (Mr. Pouliot) is not here, I suggest that it be allowed to stand.


Mr. Speaker:: The hon. member is not here.
It will stand.



NORTHWEST ATLANTIC FISHERIES CONVENTION

Mr. Smith (Queens-Shelburne):: 1.	With respect to the northwest Atlantic fisheries convention relating to the regulation and conservation of the deep-sea fisheries, which countries (a) have ratified the convention; (b) have not vet done so?
2.	What steps have been taken by Canada and other countries to implement the terms of the convention?
3.	What studies will be made of the possibility of wasteful fishing on the continental shelf?


Mr. MacNaughl:: 1.	(a) Canada, Denmark, Iceland, United Kingdom, United States, (b) France, Italy, Norway, Portugal, Spain.
2.	As required by article II of the convention the international commission for the northwest Atlantic fisheries has been established. It held its first meeting at Washington, D.C., in April, 1951. The next meeting of the commission is scheduled for June, 1952, at St. Andrews, N.B. Meetings of the scientists have been held and meetings of the panels or working committees of the commission are being held. It can be said the terms of the convention are now being implemented and made operative, investigations being made by the scientific personnel for submission to the international commission.
3.	Studies are being conducted by the scientific group of the countries concerned. Reports will be made to the panels or working committees and subsequently to the commission for recommendation for action by the contracting governments. The investigations will include methods of fishing and the

Questions
efficiency of the existing types of gear with a view to recommending to the contracting governments the avoidance of any wasteful fishing on the grand banks.



GRAIN-SALES, STORAGE, ETC.

Mr. Wright:: 1.	What was the amount of each grade and kind of grain purchased by each licensed elevator company operating as agents of the Canadian wheat board at country elevator points in the crop year 1950-51?
2.	What was the amount of tough or damp grain In each such grade purchased?
3.	(a) What was the date of the cut-off of the 1949-50 crop year; (b) what was the amount of the different grades of grain, in storage (including damp and tough grain) at the date of the cut-off of the 1949-50 crop year?
4.	(a) What was the amount of each grade and kind of grain sold by each of these companies as designated by their certificates final in the crop year 1950-51; (b) what was the amount of each grade and kind of grain retained in storage as covered by inspectors certificate at time of weigh-over for the 1950-51 crop year?


Clarence Decatur Howe: Mr. Speaker, I wish to call to the attention of the hon. member the difficulty of answering this question, on account of the tremendous amount of information asked for. To answer the questions would practically mean the tabling of the books of the Canadian wheat board.
The hon. member asked for the amount of each grade, and I would point out to him there are 339 grades. I do not know how many country elevators there are, but there are at least 50,000. Then, he wants a separate report on each grade handled by each of the country elevators, and he asks for other information it would be very difficult to furnish. It would take months to prepare such a return; and then after the information was furnished the hon. member would need to retain a firm of chartered accountants and have them work two or three months to analyse the return. The wheat board has its own auditors; and I suggest the proper way to get the information is to call the board before the committee on agriculture and ask the board for such answers as the hon. member wants. I have no desire to withhold this information; but there is such a staggering amount of information asked, it is difficult to contemplate the answering of it.


Percy Ellis Wright: That is exactly the point. If the minister will undertake to have the board before the committee on agriculture at the next session, then I certainly will drop the question. However, this is a matter of vital interest to the farm organizations of western Canada. They do want the information.


Mr. Speaker:: Question No. 23 on the order paper, dropped.



ARMED FORCES


Mr. Gauthier (Portneuf):: What were the ranks of the officers of French origin who were in the Royal Canadian Navy, the Canadian Army and the Royal Canadian Air Force active forces and what are their present ranks?


Mr. Blanchette:: Royal Canadian Navy
Rank in 1939	Rank in 1951
Midshipman	Lieutenant-commander
Midshipman	Lieutenant-commander
Canadian Army
Captain	Colonel
Captain	Major
Captain	Lieutenant-colonel
Lieutenant	Major-general
Lieutenant	Colonel
Lieutenant	Colonel
Lieutenant	Lieutenant-colonel
Lieutenant	Lieutenant-colonel
Lieutenant	Lieutenant-colonel
Lieutenant	Major
Lieutenant	Lieutenant-colonel
Lieutenant	Lieutenant-colonel
Lieutenant	Major
Lieutenant	Major
Lieutenant	Lieutenant-colonel
Lieutenant	Lieutenant-colonel
Lieutenant
(bandmaster) ... Captain
Royal Canadian Air Force
Flight lieutenant .. Wing	commander
Flying officer....Group captain
Flying officer....Wing	commander
Pilot officer	Wing	commanderPilot officer	Wing	commander



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Nowlan:: On how many ships or vessels, other than those for the Department of National Defence has construction been commenced in Canadian shipyards during (a) the calendar year 1950; (b) each month during the year 1951?


INDIANS-MONTHLY RATIONS
Mr. Fulton:: 1.	What is the scale of monthly rations for Indians on relief as issued by the Indian affairs branch to merchants in Canada, for families or groups of one to six adults respectively, and for the following commodities: flour, rolled oats, baking powder, tea, sugar, lard, beans, rice, cheese, meat or fish, salt, matches?
2.	What grade of flour is specified?
3.	What are the particulars of any other commodities and quantities which go into this ration scale?


Mr. Harris (Grey-Bruce):: Return tabled.



MOTIONS FOR PAPERS


Percy Ellis Wright: For a copy of any agreement or agreements made between the Canadian National Railways and Imperial Oil Company Limited in regard to the exploration and the development of mineral or oil resources on the said companies' lands.


Mr. Chevrier:: Mr. Speaker, there is objection to this notice of motion, because it offends against the principle of giving information of one of the railway companies to a private competitor. This matter was threshed out at some length in the committee on railways and shipping on March 30, 1950, when the very information sought here was requested by an hon. member, and objected to by the president of the Canadian National Railways. He took the stand then that it was not in the interests of the railways to give this information, and the committee upheld him. For those reasons, Mr. Speaker, I would object to the information being given.


Mr. Fulton:: I do not wish to have it dropped, but-


Mr. Speaker:: The motion is not debatable, but I will hear the hon. member briefly.


Edmund Davie Fulton: I was about to say, by way of a question of privilege, that the minister did refer to a question in committee last year. I was the member who requested that information. May I point out that I do not think the precedent set in committee covers this house at all. What was requested in committee by me was general information as to the price being paid to the Canadian National Railways for the sale of its oil lands or leases. I did not request the information in the terms of this motion, and I think that should be made clear on the record.


Lionel Chevrier: If this motion were to pass, the information for which the hon. member asked in committee would be obtained through the production of these agreements. I am objecting to that.


Mr. Speaker:: Is the hon. member for Mel-fort (Mr. Wright) prepared to drop the motion?


Percy Ellis Wright: I think this information should be available. These are crown lands. I am not prepared to drop the motion.


Mr. Speaker:: Is it the pleasure of the house to adopt the motion?


Some hon. Members:: Nay.


Some hon. Members:: Yea.
Motions for Papers


Mr. Speaker:: Shall I declare the motion dropped?


Percy Ellis Wright: No, no. The yeas and nays should be called.


Mr. Speaker:: Does the house wish me to ask for the yeas and nays? Those in favour of the motion will say yea.


Some hon. Members:: Yea.


Mr. Speaker:: Those against the motion will say nay.


Some hon. Members:: Nay.


Mr. Speaker:: In my opinion the nays have it.



PROPERTY FOR POSTAL TERMINAL, LONDON, ONT.

Mr. While (Middlesex East):: For a copy of all correspondence exchanged between the Department of Public Works and/or the Post Office Department and the International Harvester Company of Canada regarding the proposal to purchase from the International Harvester Company property situated at the southeast corner of York and Clarence streets, London, Ontario, for a postal terminal on the Canadian National Railways; also a copy of all correspondence exchanged between the Department of Public Works and/or the Post Office Department and D. H. Howden Company regarding the purchase of the above named property.


Alphonse Fournier: May I ask the hon. member if he will allow this motion to stand. I understand that this is the subject of expropriation proceedings before the exchequer court. I have not had time during the last few days to get in touch with the officials. Hon. gentlemen know that I have been in the house, and I have not done any office work in the last few days.


Mr. Speaker:: Stand.



NATIONAL FILM BOARD


[Stage Direction]
On the orders of the day:
Mr. M. J. Coldwell (Roseiown-Biggar):: should like to direct a question to the Prime Minister. In view of the fact that the report of the film board has been presented this morning, will the government consider setting up a committee, similar to the one which examined the affairs of the broadcasting corporation, to look into matters concerning the film board? I am not doing this in a critical sense, but I think the board should have an opportunity of explaining its work to members and members should have an opportunity of knowing what the film board is doing.


Louis Stephen St-Laurent: The government will be glad to consider the suggestion made by the hon.
member for Rosetown-Biggar. I assume he means that the establishment of such a committee should be recommended at the next session.


Major James William Coldwell: That is right.


Louis Stephen St-Laurent: The matter will be given consideration between now and the next session.



STARVATION CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. J. M. Macdonnell (Greenwood):: I wish to direct a question to the Secretary of State for External Affairs. I have sent notice which I hope he has received. Has the government been advised of starvation conditions in Greece, and has it been asked for aid? What steps are being taken, by either national or international means, to help this brave people who have suffered so much in the cause of freedom?


Hon. L. B. Pearson (Secreiary of State for External Affairs):: I received notice of the hon. gentleman's question just as I was coming into the house, so I am afraid I may not be able to give him as detailed an answer as I would otherwise have desired to do. It is true that through our embassy in Athens we have been made aware of the very difficult and distressing conditions among the people in the northern area of Greece. To my knowledge, however, we have not received from the Greek government any request for assistance. The matter is nevertheless being looked into on the basis of the reports we have received from our embassy. It is also true of course that a great deal of assistance of an international kind has been given to Greece in recent years. This, among other things, is a recognition by those who have given assistance, including Canada, of the great services the Greek people have rendered to the free world during and after the war. Having said that, however, I should add that the resources of Canada for international assistance are not unlimited.



CRIMINAL CODE


[Stage Direction]
On the orders of the day:
Mr. J. G. Diefenbaker (Lake Centre):: I wish to direct a question to the Minister of Justice. I should like to know whether or not the report of the commission on the momentous

amendments to the Criminal Code is available yet. If not, and if it is brought down during the recess, would the minister send copies to the members of the house, particularly to the lawyer members, so that the opinions of local bar associations can be secured regarding the provisions of the suggested amendments? I think it would be most helpful to have the benefit of the opinions of the bar associations on a matter so important as extensive amendments to the Criminal Code that take place only once every sixty years.


Stuart Sinclair Garson: I am sure my hon. friend will realize that a report of this nature must necessarily involve some questions of government policy. Therefore, while we would be anxious to get the widest distribution possible of the report amongst members as soon as possible, I cannot very well take any steps in that regard until I have discussed it with my colleagues in the cabinet. As I indicated a few days ago, when I think it was my hon. friend who asked the question, not only have we not received the report but we do not expect to receive it for some little time yet. I can assure him it will be promptly taken up with the cabinet and that our action from that point on will be governed by the decision reached therein.



CAPITAL COST ALLOWANCES


[Stage Direction]
On the orders of the day:
James MacKerras Macdonnell: I have a question I wish to put to the Minister of Trade and Commerce of which I have sent notice. Can the minister before the end of the session inform the house statistically how much cut-back he estimates there has been in capital expenditure since the announcement of deferred capital cost allowance? How much of this cut-back was due to (a) credit restriction; (b) curbs on instalment buying; (c) deferred capital cost allowance-


Some hon. Members:: Order.


James MacKerras Macdonnell: -and, Mr. Speaker, (d) any other cause.


Mr. Speaker:: Order. The question might be a proper one to appear on the order paper but as we are getting near the end of the session I think probably it can be put now.


James MacKerras Macdonnell: Thank you, Mr. Speaker.


Clarence Decatur Howe: This question covers a good deal of territory. It asks the government to
Inquiries of the Ministry read the minds of people who do not go ahead with their capital expenditures. I do not know that we can do that.


James MacKerras Macdonnell: It is not an
easy question but I have great confidence in the minister!


Clarence Decatur Howe: However, I will be glad to turn it over to our statisticians and attempt to answer it as best we can, without guaranteeing the accuracy of the reply.



IRRIGATION


[Stage Direction]
On the orders of the day:
Major James William Coldwell: should like to ask the Prime Minister if there is any likelihood of our receiving the report of the commission investigating the South Saskatchewan river project before the end of the session?


Louis Stephen St-Laurent: No, there is not. I am told it may be February or March before they will have completed their studies.



ROYAL CANADIAN AIR FORCE


[Stage Direction]
On the orders of the day:
George Alexander Drew: I wish to direct a question to the Minister of National Defence concerning a matter which has just come to my attention, but I presume he can answer without notice. Is it correct that prefabricated metal huts are being sent to Great Britain to house R.C.A.F. personnel over there?


Hon. Brooke Claxton (Minisier of National Defence):: We are purchasing a number of prefabricated huts in Great Britain for use as storage depots for the R.C.A.F. but not for married quarters. The situation with respect to married quarters is that at the R.A.F. station at North Luffenham there are ninety-two permanent married quarters. The R.A.F. has been most co-operative in making them available. So far we have got possession of all except fifteen. When the wing moved to the other side transportation was provided for the wives and children of ninety-two officers and airmen. The others were warned that there would be no accommodation for them, and I am afraid that situation will continue. As hon. members know, there is a severe housing shortage in the United Kingdom. The station is located in an agricultural district, and there will be no accommodation for any considerable number of married personnel.
2060	HOUSE OF
Agricultural Products Board



AGRICULTURAL PRODUCTS BOARD TO PRESCRIBE THE CONSTITUTION AND POWERS OF THE BOARD, AND TO PROVIDE FOR NECESSARY EXPENDITURES

[Stage Direction]
The house resumed, from Saturday, December 15, consideration of the motion of Mr. Gardiner for the second reading of Bill No. 18, to provide for the establishment of an agricultural products board.
Percy Ellis Wright: Mr. Speaker,
when the house rose on Saturday we were discussing a point of order. I should like to make a submission with respect thereto before you rule whether or not the amendment of the hon. member for Assiniboia (Mr. Argue) is in order. The operative section of the bill is section 4. Subsection 1 (a) reads as follows:
. . . the board may, with the authority of the governor in council and under the direction of the minister (a) sell or deliver agricultural products to the government of any country . . . and for these purposes may purchase agricultural products and make such arrangements for the purchase, sale or delivery of agricultural products as it considers necessary . . .
Subsection 1 (c) provides that the board may "buy, sell, or import agricultural products". Subsection 3 reads as follows:
Except with the approval of the governor in council, the board shall not sell an agricultural product pursuant to paragraph (a) or (c) of subsection 1 at a price lower than the purchase price thereof plus handling, storage and transportation costs.
It sets a floor under which the board may not sell these particular agricultural products. Subsection 5 reads as follows:
(5) The board may, when so appointed under paragraph (i) of subsection one of section nine of the Agricultural Prices Support Act, 1944, undertake the purchase and the disposition of agricultural products for the purposes of that act.
All that the amendment of the hon. member for Assiniboia (Mr. Argue) does is to place in this section of the act a floor similar to that which subsection 3 places under sales made under (a) and (c) of subsection 1. I would therefore argue that the amendment is in order.


Mr. Victor Quelch (Acadia):: Mr. Speaker,
I think the amendment should be considered to be in order because this act is definitely governed by the Agricultural Prices Support Act.


Some hon. Members:: Louder.


Mr. Speaker:: Order.


Victor Quelch: I was saying that I think the amendment should be considered to be in order because this act is definitely governed by the Agricultural Prices Support Act. The
(Mr. Claxton.l

point was referred to by the hon. member for Melfort (Mr. Wright). Subsection 5 of section 4 of the bill reads as follows:
The board may, when so appointed under paragraph (i) of subsection one of section nine of the Agricultural Prices Support Act, 1944, undertake the purchase and the disposition of agricultural products for the purposes of that act.
The point is this. At what price will these goods be bought? We want a formula to be inserted in section 9 of the Agricultural Prices Support Act which will definitely state that the same price relationship will be maintained today as existed from 1943-45. If that is not done, in supporting this act we are really buying a pig in a poke. We do not know what the price will be. Therefore I presume that if this amendment carried, the government would then give consideration to placing a formula in section 9 of the Agricultural Prices Support Act. It is all very well for the Minister of Agriculture to say that by regulation they have established a formula; but that regulation may be changed overnight. On the other hand, if we have legislation outlining the formula, we will then know at least that that formula will exist until such time as parliament may decide to rescind it.


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I wonder if I might say a further word on the point of order. From what Your Honour said the other evening when the point was first raised by the Minister of Agriculture (Mr. Gardiner), I take it that at that time you felt that you would hesitate to rule the amendment out of order. Nevertheless the Minister of Agriculture later sought to make a point; and lest you be giving any consideration to the minister's point I think we should have it perfectly clear.
The Minister of Agriculture sought to make the point that the last time this type of amendment was proposed was to the motion for the second reading of a bill amending the Agricultural Prices Support Act. The inference in that comment would naturally be that this amendment is relevant to the other bill but not to this one. As both the hon. member for Melfort (Mr. Wright) and the hon. member for Acadia (Mr. Quelch) have pointed out, the question of what prices products will be bought at by this board is distinctly and definitely relevant to the bill which is now before us. Surely that is obvious. As a matter of fact, as I read the two acts under consideration, Mr. Speaker, it seems to me that it is more under this bill than under the other one that the principle of giving support to farm prices is carried out. If we are going to know whether this bill is worth anything, we should know

whether there is going to be a floor under the prices that the government will pay for agricultural products.
It seems to me that the proposal of my colleague, the hon. member for Assiniboia, is every bit as relevant to this bill as it was to the other one. In fact, I am inclined to the view that it is even more relevant to this bill because this is the one that sets up the board that does the actual purchasing. Therefore, on the ground of relevancy, it seems to me that the amendment is in order. Further, I would say, as Your Honour indicated in the remarks you made when the point was first raised Saturday night, the amendment is also in order in that it comes within the provision of paragraph 657 of Beauchesne's third edition.


Righi Hon. J. G. Gardiner (Minisler of Agriculture):: Mr. Speaker, in reply to what has just been said, I would point out that subsection (i) of section 9 of the Agricultural Prices Support Act reads as follows:
(i) to appoint commodity boards or other agents to undertake the purchase and the disposition of agricultural products;
All this reference to it in this act does is to say that if the government agreed that the agricultural prices support board should purchase some commodity under this board, then that may be done. It is just possible that under paragraph (i) no commodities whatsoever would be referred for purchase to this board under the Agricultural Prices Support Act. The question which is relevant to the whole discussion is the one that was raised by the hon. member for Brant-Went-worth (Mr. Charlton) at the beginning of this discussion on second reading, when he wanted to know definitely from the minister whether this board interfered with the activities of boards appointed by the provinces under their legislation. Of course it does not interfere in any way with them. As a matter of fact, I would go on to say that the government has promoted those organizations through discussions with the provinces and otherwise, and has no desire to interfere with them in any way whatsoever.
All that the Agricultural Prices Support Act says is that any agency may be appointed b'y the board in order to do what it is determined should be done. What my hon. friends are suggesting is that in this act we ought to determine what the agricultural prices board is going to do. That of course is not a matter which could be dealt with in this act. I might suggest, Mr. Speaker, that if you are going to rule that we could go so far afield in this house, on the question of relevancy, as to amend or to propose the amendment of another act, then there is not any limit
Agricultural Products Board that could be put on this discussion at all. The point at which the question of order should have been raised was when the question of action taken under the Agricultural Prices Support Act was first brought into the discussion. If reference is made to the discussions during the consideration of the resolution, I submit that it will be found that that question was raised.
It is obvious that, when one piece of legislation is introduced into this house, it is not the proper thing to do to suggest an amendment to another piece of the legislation which is already on the statute books. The time to amend that legislation is when it is before the house. An attempt was made to do that in the session of 1950, as has been pointed out, and this house voted the resolution down at that time. Now an attempt is being made to have the same amendment to that act discussed under this bill. That of course would be improper. There would be no limitation at all on our discussions in this house, on the question of relevancy, if that procedure were permitted.


John George Diefenbaker: In
answer to the right hon. gentleman, Mr. Speaker, I would point out that one of the powers under section 4, subsection 1(c), is to "buy, sell, or import agricultural products." The amendment provides that in making those purchases provision should be made for the establishment of floor prices at such levels as to guarantee to producers a price-cost relation not less favourable than that prevailing in the period 1943-1945. There can be no amendment more relevant than the one in question which, while it provides that parliament sets up the board, also assures the protection of the producer in that the prices the board shall pay shall bear the relationship set out in the amendment. On the grounds of relevance and applicability I submit that the amendment is in order. Surely we are not attempting to set up a board and to give it the power to do anything, to buy at whatever price at which it desires to buy regardless of the wish of the producers, with absolute powers being given to the board. As I see it, the amendment gives the direction of parliament to the prices that shall be paid by the board,


Mr. Speaker:: I thank hon. members for going into this matter so carefully. I might say that when the amendment was proposed on Saturday night I did say, as the member for Winnipeg North Centre (Mr. Knowles) has stated, that I would hesitate to rule the amendment out of order at this time without at least looking up the amendment moved previously. At that time I was not aware that the amendment that had been moved
2062	HOUSE OF
Agricultural Products Board previously referred to another bill. I should have grasped that fact probably, but I did not.
I might say that since Saturday night I have given considerable thought to this question. In fact, the amendment was moved late Saturday night andi the result has been that I, the Clerk, the Clerk Assistant and the Journals branch worked not only late Saturday night but also on Sunday. None of us like to work on Sunday, and it is even less palatable when the house is working six days a week. However, I considered the question a very important one, and I have gone into the matter carefully. I have listened attentively to what has been said this morning.
I do not think the merits of an amendment, that is with respect to whether or not it is in order, have ever been put more clearly to the house. As I say, I considered it a very important question, and I crave the indulgence of the house while I give my ruling. So there will not be any anticipation, I might say that I do not hold the amendment can be put to the house at this time.
As I said, I have had an opportunity over the week end to give consideration to the matter which was in issue at ten o'clock Saturday night. Hon. members will recall that on the motion for second reading of a bill to provide for the establishment of an agricultural products board, there was moved an amendment by the hon. member for Assini-boia (Mr. Argue):
That Bill No. 18 be not now read a second time but that it be resolved that in the opinion ot this house consideration should be givdn to the introduction of legislation providing for the establishing of floor prices at such levels as to guarantee to producers a price-cost relationship not less favourable than that prevailing in the period 1943-45.
The Minister of Agriculture (Mr. Gardiner) raised the point of order that, while such a motion would be appropriate as an amendment to the Agricultural Prices Support Act, 1944, it was not related in any way to the present measure. The hon. member for Acadia (Mr. Quelch) had earlier expressed the same view when he said:
Therefore I think the amendment of the hon. member for Assiniboia is good; only unfortunately I think it is an amendment to the Agricultural Prices Support Act rather than to the agricultural products board measure.
The hon. member for Winnipeg North Centre reminded me that I had allowed an amendment similar to the one before the house in March 1950, on the motion for the second reading of a bill to amend the Agricultural Prices Support Act, 1944. He added that in any event, under citation 657 of Beauchesne's Parliamentary Rules and Forms, third edition:
It is competent to a member who desires to place on record any special reasons for not agreeing to the second reading of a bill, to move as an 

amendment to the question, a resolution declaratory of some principle adverse to, or differing from, the principles, policy or provisions of the bill . . .
The hon. member for Melfort (Mr. Wright) and several other members pointed out that there was a definite connection between the two acts in question by virtue of subclause 5 of clause 4 of the present bill, which reads as follows:
The board may when so appointed under paragraph (i) of subsection one of section nine of the Agricultural Prices Support Act, 1944, undertake the purchase and disposition of agricultural products for the purposes of that act.
It should, I think, be made clear at the outset that citation 657 of Beauchesne's third edition must be read together with citation 354 in the same edition, which reads as follows:
An amendment setting forth a proposition dealing with a matter which is foreign to the proposition involved in the main motion is not relevant and cannot be moved.
On November 15, 1949, I ruled that an amendment to the motion for the second reading of a bill, though in proper form under citation 657, is not in order if it does not satisfy the requirement of relevancy as set forth in citation 354. (See also Canadian Commons Journals, 1948, page 387.)
The present amendment satisfies the language of citation 657, and is thus in proper form under that citation, as has been maintained by the hon. member for Winnipeg North Centre. We must, however, go further and consider whether the present amendment also satisfies the requirement of relevancy. An amendment similar to this was allowed to stand on March 28, 1950, on the second reading of a bill to amend the Agricultural Prices Support Act, 1944. That precedent is authority for the proposition that such an amendment is relevant to that act, but is silent on the question whether it is relevant to the measure now before the house. It is to this question that I must now address myself.	.
The principle of the proposed amendment lies in the establishment of general floor prices for agricultural products. The question, therefore, is whether that principle, though it differs from the principle of the present bill, is relevant thereto. I have carefully examined each of the clauses of the present bill, and I cannot see where any of them contemplate anything in the nature of the establishment of general floor prices for agricultural products. The functions of the board include the purchase and disposition of agricultural products, but not the establishment of floor prices for such products. Subclause 5 of clause 4 of the present bill does, as indicated by the hon.

member for Melfort, create a certain relationship between the two acts, but the effect of the subclause is, as I see it, that when appointed under the Agricultural Prices Support Act, 1944, the agricultural products board may purchase and dispose of agricultural products for the purposes of the first mentioned act: it does not authorize the board to institute floor prices.
I have in the past allowed amendments of this character to be moved in respect of the Agricultural Prices Support Act, 1944. However, the present amendment, though in proper form under citation 657 of Beau-chesne's Parliamentary Rules and Forms, third edition, is, in my view, foreign to the present bill and so does not satisfy the requirement of relevancy set forth in citation 354 of the same edition. Accordingly, I declare the proposed amendment out of order.


Mr. Argue:: With the greatest respect, but because I feel the amendment is relevant to the bill, I must appeal your decision.


Mr. Speaker:: All those in favour of sustaining the Speaker's ruling will please say yea.


Some hon. Members:: Yea.


Mr. Speaker:: Those opposed will say nay.


Some hon. Members:: Nay.


Mr. Speaker:: In my opinion the yeas have it.
Agricultural Products Board
Blanchette	Laing
Blue	Langlois (Gaspe)
Boisvert	Lapointe
Boivin	Lesage
Boucher	Little
Breithaupt	Macdonald (Edmonton
Brown (Essex West)	East)
Bruneau	MacKenzie
Cameron	MacLean (Cape Breton
Chevrier	North and Victoria)
Clark	MacNaught
Claxton	Macnaughton
Cleaver	McCann
Corry	McCubbin
Croll	McCusker
Darroch	McDonald (Parry Soun<
Dechene	Muskoka)
Decore	Mcllraith
Dewar	McLean (Huron-Perth)
Dickey	McWilliam
Dion	Masse
Dumas	Mayhew
Eyre	Mutch
Ferrie	Nixon
Fournier (Hull)	Pearson
Garland	Prudham
Garson	Richard (Ottawa East)
Gauthier (Lake St. John) Riley	
Gauthier (Portneuf)	Rinfret
Gauthier (Sudbury)	Robinson
George	Rooney
Gibson	Rcss (Hamilton East)
Gregg	St. Laurent
Harris (Grey-Bruce)	Sinclair
Hellyer	Stuart (Charlotte)
Helme	Studer
Henry	Tremblay .
Hosking	Viau
Howe	Ward
Huffman	Weir
James	Welbourn
Jutras	Whiteside
Kickham	Whitman
Kirk (Digby-Yarmouth)	Winkler
LaCroix	Winters
Lafontaine	Wood-97.
And more than five members having risen: Mr. Speaker: Call in the members.
Mr. Speaker put the question as follows: On the motion for second reading of Bill No. 18, to provide for the establishment of an agricultural products board, Mr. Argue moved in amendment: That Bill No. 18 be not now read a second time but that it be resolved that in the opinion of this house consideration should be given to the introduction of legislation providing for the establishing of floor prices at such levels as to guarantee to producers a price-cost relationship not less favourable than that prevailing in the period 1943-45.
I ruled the amendment out of order on the ground that though in proper form, under citation 657 of Beauchesne's third edition, it was not relevant to the present measure. From this ruling the hon. member for Assiniboia (Mr. Argue) and others have appealed.


James Garfield Gardiner: I was paired with the hon. member for Souris (Mr. Ross). Had I voted, I should have voted to sustain the Speaker's ruling.


Mr. Cardiff:: I was paired. Mr. Speaker,
had I voted, I would have voted against your ruling in this case.

Agricultural Products Board


Mr. Browne (St. John's West):: I was paired with the hon. member for Yukon-Mackenzie River (Mr. Simmons). Mr. Speaker, had I voted, I would have voted against your ruling.


Mr. Speaker:: Is the house ready for the
question?


Percy Ellis Wright: Mr. Speaker,
when the house rose on Saturday night I was speaking on the amendment. I wish to continue the remarks I was making at that time, although they will have to be changed somewhat, owing to the fact that you have ruled the amendment out of order.
I was pointing out at that time that ministers of the crown, including the Minister of Finance (Mr. Abbott) and a former minister of finance, had stated that they believed it was necessary for any government to lend support to the price of government bonds and government securities. I was arguing that if the government found it necessary to support the price of its own securities, then there was even greater reason why it should maintain fair prices for agricultural products. I argued that food was just as important as government securities. One cannot wear or eat securities; but to live he must avail himself of the products of the farm. And those farm products are, in our economy, the one group of products which in my opinion govern the prosperity of a great many other sections of our country.
Any time there is a violent fluctuation in the prices of agricultural products, one finds unemployment, with a falling off of production of not only agricultural products but many other lines of goods.
The board to be set up under this measure is one means the government may use to prevent these fluctuations, if such board is used by the government for that purpose. I agree with the principle of the setting up of the board. But I am quite certain, from the actions of the Minister of Agriculture (Mr. Gardiner) in connection with our amendment, that he does not intend to use this board for the purpose of maintaining fair prices for agricultural products in this country.
One of the results of this will be that, while our economy may not plunge, it may gradually slide into a condition of insecurity. To bear out what I say I should like to place on record certain figures showing what has taken place in the United States, and to indicate what has happened there.


James Garfield Gardiner: Mr. Speaker, I rise to a
point of order. The decision has just been given that the matters now being discussed by the hon. member for Melfort do not refer


to this measure at all, but refer to other measures. I suggest the hon. member for Melfort has no right to follow that line of discussion, and that if he persists he will be out of order in so doing.


Mr. Deputy Speaker:: I must ask the hon. member to confine his remarks to the principle of the bill before us.


Percy Ellis Wright: Yes. The principle of the bill is to set up a board which, under section 4 (1) (c), is to buy, sell or import agricultural products. How any board can buy, sell or import agricultural products without paying attention to prices is beyond me. I cannot understand why the Minister of Agriculture insists that this board shall not have anything to do with prices. I do not know what use it would be if it did not deal with prices.


James Garfield Gardiner: To answer the question-


Percy Ellis Wright: I did not ask a question. The minister can answer when he makes his speech.


James Garfield Gardiner: On the point of order raised-


Stanley Howard Knowles: No point of order was raised.


James Garfield Gardiner: Before my first interruption the hon. member did say, "If the minister said that this bill has nothing to do with the fixing of prices"-and I am going to suggest to him that it has nothing to do with the fixing of prices, and there is nothing in the statement of its principle that indicates that it has. All it says is that if the government instructs this board to buy farm products, then it may buy them. But the government will state at the time the conditions under which it will buy.


Percy Ellis Wright: Mr. Speaker, unless you rule otherwise, I intend to pursue the argument I was following; that is, the argument that if this board is set up it must quote prices when it buys and sells agricultural products. And in quoting those prices it does affect the economy of this country. I suggest that arguments in respect to that are in order under this bill.
As reported in the Country Gentleman for June, certain arguments were put forth in the United States as to what effect agricultural prices had on the economy of that country. Our economy in Canada is very closely related with that of the United States. The same factors which govern the rise and fall of prices over there govern the rise and fall of prices in this country. In that article it states that if there was to be a reasonable stability in the economy of the United States:
There is one requirement. The products of agriculture and our other raw materials must be priced at levels that will generate and maintain the income necessary for these conditions of prosperity.

They are the primary power source of our economy, the controlling influence in its operations. The economic record of this country for the past twenty-five years demonstrates this fact with mathematical conclusiveness. Over that period, in good years and bad, the national income has held to a ratio of close to seven times the gross farm income. For the full 25 years it averages exactly that proportion.
All the major interests in our economy are geared to the same governing factor, a study of the record clearly shows. The value of manufactures, labour pay rolls and employment, the volume of retail sales and construction expenditures all have inevitably followed the course of farm income, up or down, within short intervals.
Both the prosperity peaks of 1947-48 and the downward turn of 1949 confirm the invariable working of this process. Gross farm income reached a high of $33 billion in 1947. Its effects carried over into the unequalled prosperity of 1948, sustained also by a gross farm income of $32.5 billion that year. But in 1949 we failed to safeguard this state of prosperity. The price level of 35 leading commodities, most of them farm products, in September, 1948, stood at 186 per cent of the price level of the 1926 base period. By July, 1949, the price level of these 35 leading commodities had dropped to 150 per cent. The decline in national income, factory output and employment were the direct and natural results.
If we permit farm income to recede further we can expect these same results to be repeated in corresponding degree. A drop of 10 per cent in gross farm income will force a loss of approximately $20 billion of national income.
And later:
Agriculture supplies 65 per cent of our raw materials and its income is the most sensitive and active part of this combination. Its products are mostly the kind that quickly enter into use, generating a rapid turnover. Also farm income is distributed among a large number of individuals, while more than one-half of our labour force is engaged in processing and distributing the products of agriculture. A drop in farm prices is carried through this whole economic circuit. A decline of $1 in gross farm income will result in a loss of about $4 of retail sales volume.
And later on it states:
Any benefit consumers get from cheap food prices will be shortlived and paid for many times over in reduced purchasing power, as the record of our economy for 25 years clearly proves. Food was cheap in 1939, when farm prices were at 84 per cent of parity, but 16 per cent of our labour force was unemployed and purchasing power also was low.
That is exactly what has happened in Canada. In 1939 when farm prices were low we had unemployment. Right now the Minister of Finance (Mr. Abbott) is favoured by a large surplus. Why? One of the basic reasons for that surplus is the large farm income this year. Large farm income is one of the basic factors in maintaining prosperity in this country.
Under this legislation the minister should provide that reasonable prices prevail in this country for agricultural products. That is necessary if we are to maintain prosperity in this country. This bill provides that the board to be set up will have the power to buy and sell agricultural products both in Canada and abroad.
Agricultural Products Board
When the Minister of Agriculture (Mr. Gardiner) attended the food and agriculture organization general meeting in Washington some two years ago he argued, if the press was correct, against the maintaining of basic supplies of food in reserve throughout the world. I understand that at the recent meeting in Rome of the food and agriculture organization, attended by the minister, he changed his position and stated that he believed that reserves of food established under the food and agriculture organization might be a good thing.
If the press is correct, the minister also argued that if we were to get maximum agricultural production there would have to be some guarantee of future prices so that when a man commenced to produce a particular agricultural product he would be sure that he would obtain a reasonable price when he marketed that product. Apparently the minister can argue that in Rome, but when it comes to instituting the necessary legislation in order to make that principle workable here in Canada it is a different thing.


James Garfield Gardiner: I again raise the question that the hon. member is out of order. There is legislation to provide what he is asking for, but this bill has nothing to do with it.


Mr. Deputy Speaker:: The amendment has already been ruled out of order and it is not in order to discuss the same thing on the main motion.


Percy Ellis Wright: This bill provides for the setting up of an agricultural products board which will have the power to buy and sell agricultural products both in Canada and abroad. If that has nothing to do with the maintaining of fair prices of agricultural products, then I do not know what the bill was brought in for. Otherwise, it would have no meaning.


James Garfield Gardiner: The hon. member can vote against the bill, but he should not discuss another bill.


Percy Ellis Wright: The Agricultural Prices Support Act has no meaning unless there is a board to carry out the provisions of that act. The minister stated on the resolution stage of this bill that the three boards which had been set up for the purpose of selling agricultural products were to be replaced by a single board. When the minister was questioned on the matter of prices he replied that the board set up under the Agricultural Prices Support Act was set up simply to obtain statistics. If the statistics obtained are not carried forward into the implementation of other legislation, there can be no meaning to

Agricultural Products Board those statistics. The minister cannot have it both ways. He should read his own speeches to see what he says.


Stanley Howard Knowles: They all go both ways.


Percy Ellis Wright: I agree with the principle of setting up an agricultural products board, but unless the minister changes his position and uses this board for the purpose of maintaining reasonable and stable prices in this country, it means nothing at all. What has happened to our prices? The other day the hon. member for Assiniboia (Mr. Argue) noted where the price of eggs had fallen fourteen cents per dozen in one day in one market. Less than six months ago the price of pork fell ten cents per pound.


Mr. Deputy Speaker:: I am sorry to have to call the hon. member to order, but in my opinion he cannot discuss floor prices under this bill.


Percy Ellis Wright: I must abide by your ruling, but I contend that there is no use in setting up a board under this bill unless it is given the necessary power to establish reasonable prices for agricultural products in this country.


Mr. A. W. Stuart (Charlotte):: Mr. Speaker, it is not often that I take part in a debate on agriculture, but I would like to take just a few minutes to place my views on the record. I come from a part of the country faced with problems very similar to those encountered by agriculture in western Canada. However, I must say that I am astonished at the action taken by those members of parliament who represent agricultural ridings or ridings in which agriculture is of great importance.
Every single resolution or bill in connection with agriculture, regardless of what it might be, has been responsible for touching off a full-dress debate on everything from the fertilizer and seed until the product is finally marketed. We sit here week after week and have amendments brought in; we have Mr. Speaker's rulings discussed and voted on. It would seem to me that far too much time of the house is taken in the repetition of the same questions and the same answers over and over again. In the maritime provinces there are many problems in the fishing industry similar to those encountered today in the agricultural industry.


Mr. Gibson:: Just as important too.


Andrew Wesley Stuart: Andi just as important to the people there. I want to take a minute to say that I know that during the pasx two years hundreds of fishermen have not paid expenses. They have taken their


money and put it into equipment, and conditions have been such that they have not paid expenses. These people have never asked for any assistance. I put a question on the order paper some time ago-it can be found in Hansard-and hon. members will find that every single dollar paid out under the Fisheries Prices Support Act this year went to the province of Newfoundland. Not a single dollar was paid to any other province in Canada. In other words these people like to stand on their own feet as long as possible. I have every respect for the views of members representing western Canada, but I think these problems could be dealt with more expeditiously than by taking up time day after day, particularly when Christmas is near, in discussing the same thing over and over. The record in Hansard will prove that, so far as many of the speeches that have been made are concerned, they can be found repeated on different occasions in Hansard of different dates.


John George Diefenbaker: Mr. Speaker, I was quite interested in the remarks of the hon. member who preceded me. If conditions are as serious in the maritimes as he says they are and many hundreds of fishermen have not made their expenses in the last two years, then I would say that instead of reading a lecture to those from the western provinces he should be standing up in the house and demanding some action to preserve the fishermen of the maritimes.


Andrew Wesley Stuart: On a question of privilege, I might say that I have taken up the question, but I believe there are different approaches than taking up hours and days of the time of the house. I believe there is a more efficacious way of approaching these problems.


John George Diefenbaker: I agree with the hon. member that the situation is serious there, and if he and the other maritime members associated with him who support the government have taken up the matter then their lack of success must be attributable to government policy.


Andrew Wesley Stuart: On a question of privilege, Mr. Speaker-


John George Diefenbaker: Well, Mr. Speaker-


Andrew Wesley Stuart: On a question of privilege, not a single fisherman in my riding has ever approached me to try to get my assistance. I know their problems, and I know what they are up against, but they have never asked me to approach the government.


Mr. Deputy Speaker:: The hon. member for Lake Centre has the floor.


John George Diefenbaker: I do not suppose fish comes under this measure, but my hon. friend has used it as an example, and in view of his recital of the serious conditions in the maritimes I believe the minister might very well join with the Minister of Fisheries (Mr. Mayhew) and add fish to this measure in order to ensure at least a reasonable degree of prosperity for maritime fishermen. I have not listened for a long time to a member from the maritimes boasting that, although the people he represents are having difficult times and are not securing the profit for their products which they should, nonetheless they raise no complaints. The farmers-and I speak for an agricultural constituency-on the other hand ask and, I believe rightly so, demand that they shall receive fair and proper consideration. You will never build up a prosperous country if the fishermen of the maritimes are not prosperous, and you will never build up a prosperous country unless agriculture is prosperous.


John Lambert Gibson: Ask and ye shall receive.


John George Diefenbaker: My hon. friend certainly is a true exponent of the doctrine he now enunciates.


John Lambert Gibson: I have not been asking for anything. I do not ask for anything.


Mr. Graydon:: Keep your fingers out of the buzz saw.


John George Diefenbaker: It is certainly nice that everyone is in such good form today and so friendly. It shows that we are all working together right from Vancouver island down to the maritimes. To return to the bill, the powers provided thereunder are very great. Arbitrary powers can be exercised by the board to be set up. I often hear some of my hon. friends discussing socialism in the abstract. I know of no more socialistic measure than the one now before the house. It sets up an agricultural products board with absolute power over livestock and livestock products, poultry and poultry products, milk, vegetables, fruit, honey, maple syrup, tobacco, fibre and fodder crops. It sets up a board whose authority will be absolute under regulations passed by the governor in council on the recommendation of the minister.
Far be it from me to depart at any time from your ruling, Mr. Speaker, for I follow the rulings of the Speaker with haste at all times, but the house is asked to place absolute power in the hands of the board to purchase, buy, sell or import agricultural products without any consideration of the welfare of the
Agricultural Products Board farmer who is the producer. Apparently that is the purpose. Otherwise consideration would have been given to the amendment suggested by the hon. member for Assiniboia (Mr. Argue). A very serious situation will result from the passing of this bill. Parliament meets and grants powers under this measure whereby, under regulations made by the board with the authority of the governor in council, and under the direction of the minister, it may sell or deliver agricultural products to the government of any country, purchase or negotiate contracts for the purchase of agricultural products, buy, sell or import agricultural products, store, transport or process or enter into contracts for storage, transportation or processing. If the powers contained in the bill were used by the board there would be nothing operated by private business in this country today, so far as agricultural products are concerned, that could not be done by the board.
I know of no case where greater powers have ever been granted to a board than under this measure. Powers have been granted before covering certain products. This bill covers every agricultural product imaginable and the products of agricultural products. I suggest that such power should not be granted until the house knows that the welfare of the producer is going to be considered and that parity prices are going to be assured to the farmers. Otherwise what we are doing is setting up a board with absolute powers to run practically every business having to do with agriculture in the country. We are giving the power to investigate, to require any person by order to give at any time such information regarding agricultural products as may be deemed necessary, and very great penalties are provided for failure to carry out the wishes of the board. I should like to hear the minister say something about what the formula will be under which purchases will be made and orders for purchase will be given. I hear it said so often that the farmer is the one responsible for high prices today.
Various investigations were taken in this regard. It is extremely interesting to read of the investigation which took place in the United States, where the purpose in mind with respect to the commission that was set up to look into the matter was to ascertain whether or not the farmer was the person responsible for the high prices paid by the consumer. The United States Department of Agriculture released the figures in August. They showed the degree to which the producer shares in the final price secured for consumer goods. On the basis of a 16-cent loaf of bread, the consumer would have to pay

Agricultural Products Board 13-4 cents a loaf if the wheat from which the bread is made was free. In other words, out of the 16 cents a loaf, only 2-6 cents went to the farmer and the rest went for processing and distribution. Again in connection with canned goods, as to a can of beans selling for 16 cents, the actual amount that the farmer received was 2 cents, and the balance was taken up in processing and distribution. Then, as to a $50 suit of clothes, if the wool was free and if the farmer received nothing for the wool that goes into the $50 suit of clothes, the suit would still cost $40.50. And thus it goes all through the record, indicating that the farmer, even though he receives a fair and proper price based upon parity or almost upon parity, is not the one who is responsible for the high prices that are today being paid or for the high cost of living in general.
I do not know what can be done about the situation; but certainly in the world of today where agricultural production is necessary we in Canada should join the other members of the United Nations in the establishment of a world food bank, whereby reserves would be made available for distribution in those parts of the world that are today facing starvation and whereby surpluses that heretofore have resulted in a major fall in prices would instead be used for the benefit of mankind. Certainly something must be done to encourage agricultural production in this country.
At this late stage in the session I am not going to go into a lot of statistics; but may I say that while agricultural production, in the last five-year period, has increased 9 per cent over what it was in the five-year period between 1934 and 1938, the number of people in Canada is 12 per cent greater than it was during that period. Our production is going back. Canada's milk cow population is today the lowest in twenty years. The production of milk has gone down a matter of 1 million pounds per year since the end of the war. Butter production has dropped by 50 million pounds per year since the war. Cheese production has dropped by 100 million pounds.
I think the time has come to do something in connection with prices in order to expand and to encourage production. One thing that today interferes with production is the degree to which income tax is levied against those who engage in extra production. This is a large problem but it is one that has to be met: and it will not be met by pieces of legislation such as this which empower a board to remove surpluses or to import, to buy or to sell agricultural products without parliament at the same time knowing, when


it does so, that the farmer is going to receive a fair and reasonable price.
I should like to hear the minister tell the house and the country something about that conference in Rome. I read some of the remarks he made there; they were remarks that were certainly favourable to the people of Canada and acceptable to the people of Canada. The establishment and the acceptance by Canada of a world food bank is necessary today in order to ensure that, in years of overproduction, the surpluses will not be thrown upon the market and result in the kind of conditions that the hon. member for Charlotte (Mr. Stuart) has stated, in effect, are to be found in the maritime provinces in connection with fishing. Those of us who represent agricultural ridings, when we return to our constituencies, will be asked these questions: How is this legislation going to work? How is it going to operate? What prices are we going to get?
Today the farmer is disturbed over pork prices and the fall in them of some 25 per cent during a period of some three or four months. He is asking why it is that the price he receives has fallen by 25 per cent while the consumer has had no portion of the benefit in the prices he pays. That situation underlines the necessity for our knowing what we are doing when we pass this bill. It also calls upon the government of the day to do something to investigate the spread between the price the farmer receives and that which the consumer ultimately pays.
I cannot refer to another debate that is about to take place. Unfortunately I cannot be here for that one, having some time ago made my plans which require my presence in connection with a legal case. But when I see adopted by the government these plans for removing price maintenance and the like, I ask myself why it is that, as to foods, so much solicitude is shown for those great industries that distribute them and that no investigation has yet taken place to explain the spread between the price received by the farmer and that paid by the consumers, the people of Canada as a whole. Such an investigation would, be a most interesting thing. That would be attacking the problem of prices. That would be attacking a matter that is of interest to every consumer, every farmer and every fisherman in this dominion. That would be a matter that would establish the facts so that ordinary Canadians like myself could understand why, when the price of pork goes down, as it has, the price paid by the consumer still remains the same.
Having said that, and not wishing to delay the house unduly at this time, I ask the

minister when he replies to answer questions such as those which are of interest to the farmers and are also of equal interest to the consumers who today, because they do not know the facts, too often place the responsibility for high food prices on the farmers and on agriculture in general, where it does not belong, instead of placing it upon those distributors who apparently are able to maintain their prices regardless of the fall in the price of raw products.
Mr. Robert Fair (Battle River': Mr. Speaker,
I make no apology for taking just a few minutes of the time of the house, and I may say that it will be just a few minutes because I believe that my stand in connection with the plight of the farmers of Canada is by this time well known. It must be because of the approach of Christmas, and of the good feelings being enjoyed by hon. members here, that we had the genial, good-natured hon. member for Charlotte (Mr. Stuart) come into the house and make the confession he made, admitting that the fishermen in his constituency and in other sections of the country are not making expenses. I feel that this is a terrible admission for the genial member to make. We have heard little in this house from the representatives of the fishing communities. I want to tell the hon. member that if he presents a case showing the need of the fishermen, he will certainly have the support of every member in this group. We realize that these men have suffered, and that they are not receiving a fair return for their labour. As I have said, the hon. member will have our support if he presents a case for these fishermen. He has said that too much of the time of the house is taken up by farmers pleading their case and looking for something. Just as soon as our farmers receive justice, then we shall not take up any more of the time of the house. We shall devote some of our time to rectifying the wrongs inflicted on other sections of the country. While injustices are inflicted upon our people, then it is our responsibility to plead their case, and to continue to plead it until those wrongs are put right.
The farmers of this country have been asked to increase production. If they do so they find themselves between the devil and the deep blue sea. I say that because if they increase production there is no formula in our Agricultural Prices Support Act to enable the government to support prices, so prices fall. If the farmers do happen to make a few dollars profit, then the Minister of Finance (Mr. Abbott) demands taxes, which in some cases he does not need, and we find the Minister of National Revenue (Mr. McCann) chasing these farmers to the ends
Agricultural Products Board of the earth to extract the last dollar. Many of the most prominent farmers in my constituency have said that, until we have a policy which gives the farmers justice, they are not going to produce on an all-out basis. We can hardly blame them for taking that attitude. Production in Canada this year is supposed to be very high, but included in the payments to farmers this year will be payments that have been owing to them since 1945. I hope the statisticians will not neglect to take that into consideration when arriving at their figures.
According to the best information we can obtain from the dominion bureau of statistics, in 1950 the 23 per cent of Canada's population on the land received only 9-95 per cent of the national income. I believe the farmers work longer hours and work harder than any other occupational group in Canada, so how does the government justify the fact that 23 per cent of the population received only 9 [DOT] 95 per cent of the national income? Yet at this date the government still refuses to put any formula into the Agricultural Prices Support Act which would enable farmers to receive what they are entitled to receive. Although the ruling of Mr. Speaker prevents us from holding up this legislation, so far as I am concerned I have no desire to hold up the legislation, I want to see it passed because it goes hand in hand with the Agricultural Prices Support Act. While saying that, I do want the Minister of Agriculture (Mr. Gardiner) to introduce an amendment to the Agricultural Prices Support Act at this session, placing in that act a formula in line with the statement he made on the resolution stage, that farmers should at least receive prices bearing the same relationship as those they received in the 1943-45 period. In my opinion that will not give them a proper percentage of the national income, but it will at least ensure that they shall not be fleeced as they were in the thirties when wicked men brought about that depression, which many would like to see again.


Mr. H. W. Herridge (Kootenay West):: refrained from speaking on the resolution stage of this bill, Mr. Speaker, because I understood the minister was leaving that evening and desired the passage of the resolution by ten o'clock. This is an extremely important matter to quite a number of my farmer constituents. This is the first opportunity I have had to say a few words on this bill, and I intend to take advantage of the opportunity whether or not some members of the house like it.
2070	HOUSE OF
Agricultural Products Board
We hear continuously of the great importance of the production of steel, of the production of iron ore and of the production of oil. But there is an inclination, even amongst some members of this house and a number of people in the country, to overlook the fact that all the other production in Canada depends upon the production of food. It is for that reason, Mr. Speaker, that we in this group and the members representing farm constituencies believe this is a most important measure. It is important not only because food is the foundation for all other production in this country, but because a great many of us believe that food is one of the great armaments in the efforts to build peace in the world today. It is taken for granted that business will try to get a fair profit. We hear repeatedly of the percentage of profit to which a manufacturer is entitled, or a wholesaler or a retailer. The workers organize to obtain a satisfactory wage agreement, and rightly so. The one group in the country upon whom all other activities depend is the group producing food, and the members of that group have to live a life that is, to a great extent, a gamble. Their life is dependent upon crop diseases, variable weather, markets and prices. Because we recognize this bill is a step towards building up orderly marketing in this country, and we hope it will do something to provide more economic security for the farmers, we in this group intend to support it.
May I call it one o'clock, Mr. Speaker?
At one o'clock the house took recess.
The house resumed at 2.30 p.m.


Herbert Wilfred Herridge: Mr. Speaker, I trust the house will be patient with me for a few minutes while I make a few further observations on this bill. I should like to draw the attention of the house to the fact that to the best of my knowledge I am the only British Columbian who has spoken on this bill. I think British Columbia's interests are entitled to some representation here, particularly from our point of view.
When I was concluding my remarks at the time we recessed for lunch I said that we in this group support the principle of this bill. We do that because we believe the bill does offer an opportunity to introduce greater stability and security into agriculture. We believe that if that stability and security are to be obtained this bill must be linked effectively and used effectively with the prices support act. If that is done we believe there will be some confidence established in the
'Mr. Herridge.]

future for farmers and for farmers' sons, and we might do something to arrest the very dangerous drift from the farming districts of the country to the industrial section. That drift, Mr. Speaker, is occurring right in my own constituency. Many of the younger men are going into industry because they see no future for agriculture, and many of the farms are being operated by older men.
The British Columbia fruit growers association received notice that they were to obtain a grant of $1,200,000 to assist them in connection with apple costs for the past year. The British Columbia fruit growers association is very pleased to receive that assistance, and are making arrangements at the present time to borrow money from the banks and distribute it to the growers, pending the receipt of the money from the government. But with all that, there is a great feeling of uncertainty in the fruit and vegetable industry in the southern sections of British Columbia. The fruit growers, the vegetable growers, the fruit growers organizations and the vegetable growers organizations have written to me and expressed their serious concern for the future in that respect. Our British Columbia fruit growers association is a most efficient organization and keeps its growers well informed of the situation concerning marketing from week to week. Quite recently they published a special bulletin dealing with the government assistance on the 1950 apple crop. In that bulletin they published a letter written by the minister to the president of the British Columbia fruit association, having regard to this $1,200,000 assistance, and made some other comments. These are the two comments that concern the fruit growers of British Columbia. I am going to read just one short paragraph of the minister's letter. The minister said, in part:
The government has decided, therefore, that after this grant of $1,200,000 no further assistance can be provided to the apple growers of British Columbia with respect to difficulties that have arisen and adjustments that have been necessary within the industry since the war.
At the conclusion of the minister's letter they go on to comment:
It will be noted that no mention has been made of the Agricultural Prices Support Act. This grant was not made under the act but is a special grant from the government. It is a fact that apples have not been officially accepted under the terms of the prices support act.
What is causing uncertainty is the fact that the minister has said that in future they will receive no further assistance by way of grants, and to date apples have not been brought under the prices support act.
In passing I want to indicate to the minister and to the house how careful our organization is in the distribution of government grants.

They do not treat government grants lightly. I shall quote the figures of the distribution. They made arrangements for a joint committee of the British Columbia fruit growers association and Tree Fruits Limited to distribute this money. I want to mention this to indicate the care given in their calculations. Extra fancy, large, medium and small apples will be subsidized from this grant at the rate of $0-16126772 a box, just over 16 cents a box. It is taken to the tens of thousandths of a point. All Cee grade: extra small, extra extra small in both fancy and extra fancy, cookers and hailed fruit, $0.13126772 a box. That shows just how careful they are in their accounting. I should like the hon. member for Peace River (Mr. Low) to notice just how efficient they are in the accounting end of their business.


Mr. Low:: To the tenth decimal point.


Herbert Wilfred Herridge: Yes-and in the distribution of public funds. They go on to say-and I am just going to quote two short paragraphs:
While the money will not be available from the government until next March an arrangement is being worked out to borrow the money on a reasonable basis and it is intended to place it in the hands of the shippers in time for distribution by December 10.
No one will pretend that the apple industry is in a happy state today. It would be remarkable if it were, with our offshore markets lost outright or heavily reduced by currency restrictions and subsidized competition, and our continental markets curtailed by excessive and unfair freight rates.
These conditions have led to a great deal of talk about floor prices and the Agricultural Prices Support Act. Such assistance can come only from the federal government, and there are two essential conditions which must be met before there is any hope of it. The first condition is that it must be a strong case, presented by a strong organization speaking for all the growers. We have this organization in the British Columbia fruit growers association, with its growers united by a common contract. The second condition is that, in the event of aid being granted, the grower organization must have the means of distributing it.
Both of these conditions are fulfilled. Contracts have recently been signed, and they have a very strong united organization. They have the ability to co-operate with the federal Department of Agriculture in the distribution of any funds available. I am just going to support briefly what previous speakers have said, that agricultural prices have been dropping and costs have been rising. I am not going to quote at length, but I hold in my hand a pamphlet published by the Ontario fruit and vegetable growers association entitled "The truth about fruit and vegetable prices," which gives several illustrations of the lowering of prices of farm commodities and the increasing of costs. I do want to deal briefly with a clipping from the Nelson Daily News. The vegetable growers of the interior of British Columbia recently met
Agricultural Products Board in Nelson and discussed their general business and dealt with their problems for the future. There again they are very concerned about the uncertain future. This is taken from the Nelson Daily News of November 8:
U.S. competition "unfair," vegetable growers charge.
Then there is a heading: "Planned production should be introduced." We in this group very heartily agree with that. We know that if the government is going to establish floor prices, forward prices, they cannot subsidize inefficient and uneconomical production. I read this extract from the Nelson Daily News:
Growers agreed with Mr. Wilson (chairman of the interior vegetable marketing board) that vegetable growers received a square deal in wartime when there was a floor price for the producer and a ceiling price for the consumer.
Then one grower, whom I happen to know personally, and who grows 40 acres of vegetables on very fine land, a former immigrant from Holland, a very scientific vegetable producer, has this to say:
Mr. DeJong said that an over-all program should be instituted by the government under which a farmer would be told what produce he could grow, with consideration, of course, to whether his land was suitable, availability of markets, and so on. This system is in effect in Sweden, Norway, Denmark and Holland, he said.
He goes on to deal with the uncertainty of the future. Mr. DeJong is the most efficient vegetable grower in the interior of British Columbia. Then he goes on to say this:
Everyone else has security, but not the farmer.
I think there is a great deal of merit in that statement. The article goes on:
Mr. DeJong said that this year he had put only 55 per cent of his land in crop, and had dispensed with buying any chemicals. "The risk is too great," he said.
Society, the growers agreed, is overlooking the fact that its mainstay is the production of food.
Attractive wages of industry are drawing more and more people into the cities, and young people are not entering farming.
The point of this case is that this very large grower, within ten miles of an industrial city, with a market at his door, cannot afford to pay wages in competition with surrounding industry. He has to curtail production, and curtail the quality of his farming, in order to get by at all.
The British Columbia federation of agriculture has repeatedly urged the necessity for some system of over-all forward prices. In fact, I think the British Columbia fruit growers organization was the first agricultural organization in Canada to suggest the necessity for an act similar to the Agricultural Prices Support Act. I do know that the British Columbia fruit growers association was the mother of the Canadian Federation of Agriculture. So you see we are

Agricultural Products Board dealing with a progressive and intelligent type of farmers, and some I have the honour to represent.


Mr. Laing:: Charlie Hayden was the father.


Herbert Wilfred Herridge: The hon. member for Vancouver South has mentioned that C. A. Hayden was the father of the Canadian Federation of Agriculture. At present he is secretary of the British Columbia fruit growers association, and the editor of Country Life. It was through his efforts in the early days that we had the beginning of the Canadian Federation of Agriculture.
I wish to mention one or two further points before concluding. When we talk about price support we know it will cost the country something. But we have to balance that cost against the place of the farmer in society. I was very much interested in reading in the November issue of the Manitoba Co-Operator a few figures concerning the cost of price support, per capita, in Canada. It states:
Canada's program of price support for farm products, initiated in 1946, has cost the Canadian people approximately three-quarters of a dollar per capita for the whole of the five-year period covered by the report just issued by the prices support board at Ottawa.
I am not going to deal with the figures in detail, but I would draw attention to the 75 cents per capita for price support. What would $5 per capita mean, if it were going to assure the stability of agriculture in this country, and if it were going to assure the necessary production of food both at home and for use of those abroad who are working for peace? I suggest seriously the Minister of Agriculture (Mr. Gardiner) would be quite justified in receiving funds from the Department of National Defence. In the light of the terms of the Atlantic treaty, and the activities of ministers and delegates at various organization meetings to consider united action for the defence of democracy, I say the Department of National Defence could very well say to the Department of Agriculture, "Here is $10 million to assure positive and effective price support." That would be a good investment toward the maintenance of freedom.
Before concluding I should like to quote briefly from Country Life an article which I believe would be of interest to hon. members. This is the April, 1951, issue, in which Dr. Raymond W. Miller, who has been a frequent visitor to British Columbia, and has paid direct attention to agricultural affairs, and who now acts in an advisory


capacity to the United Nations Organization, had this to say:
The real answer to the world's problems lies in assisting the rural peoples of the earth to attain a better standard of living.
I believe that expresses well and briefly the facts as we see them today. The real answer to the world's problems is to raise the standard of living of the rural people. Before I take my seat let me say that I think the hon. member for Lake Centre (Mr. Diefen-baker) made an excellent suggestion this morning when he said the government would be well advised to make an investigation into the spread between producer and consumer prices of agricultural products.
We know the producer gets only what is left, and that the consumer is paying a high price. I believe there is a great opportunity for the government in this instance to render a service to agriculture and to the consumers. It would assist the public generally in understanding the complexity of this marketing problem.
The farmers of Canada have built sound co-operative organizations. They can grow the crops. They can process the crops, and they can market them within the limits of their powers, and within the limits of fluctuating prices on a fluctuating market. There is no question about it, the farmers are doing their part. They are doing all that is required of them. I hope after the bill has been adopted the government will use the measure and link it up with the Agricultural Prices Support Act so as to give some measure of security to the farmers.


Harry Oliver White: Agricultural Products Board things. What would happen if the government decided that the price of any one of these articles was too high in Canada and therefore they would import some to be sold for less? They would certainly be in difficulty. But that is what this government is doing under this bill.
What is needed is a more definite formula for agriculture so that when products are produced producers will know that they will receive a price bearing at least some relationship to the goods and services they must buy in order to carry on their work. Otherwise this country is going to face a continually declining production of agricultural products. Farmers do not stage sit-down strikes such as industry and labour have done, but over a long period the decision to reduce agricultural production can have a far more disastrous and far-reaching effect than the more spectacular strikes we read about in our newspapers and see taking place in our industrial cities. Section 4 of the bill reads in part:
(c)	buy, sell, or Import agricultural products:
(d)	by order require any person to give, at the time specified in the order, such information respecting agricultural products as may be necessary for the proper administration of this act.
While we will be forced to support the bill, I am afraid of possible implications.


Mr. William Bryce (Selkirk):: Mr. Speaker, there are some remarks I should like to make and in doing so I shall try to keep clear of a discussion of prices and thus abide by your ruling. I agree with this bill as I think something like this has been needed for some time. My good friend the hon. member for Middlesex East (Mr. White) said that bulk buying and socialism have put Great Britain in the position she is in today. I give my hon. friend credit for knowing the situation better than that. Even today Mr. Churchill has not cancelled bulk buying. They are still carrying it on, and during the war it was the best method they could find. If they would do a bit more of it I think it would be good for us. The hon. member said: What did it get us before? He knows that wheat sold at 35 cents a bushel at one time, and we do not want to go back to that again. However, I want to confine my remarks to the minister. I hope he will give us some assurance that when this board of from three to seven members is set up there will be a representative of the producers on it. He knows what I mean. I do not need to explain it to the minister and take up time. He knows what I mean by representation for the producers.


I do not want somebody who was born on a farm and has forgotten what it looks like. I want somebody who is a bona fide farmer so that he may represent the producers on the board in company with the representatives of other classes. I think we should have been discussing prices, but I will let that matter go. All I want to say is that I think prices should be guaranteed. They should be on the basis of a formula so that we will know where we are. What I am trying to say is that in times past prices have been set but at the packers' level. I can explain that by referring to the setting of the price for lambs. It was set at a quarter of a cent less than the floor price. That was no favour whatever to the farmers. He sold his lambs to the drover or stockyard, they were purchased, and immediately they came into the hands of the packer the ceiling applied to them. I should like to see the farmers get far more protection than that.
From visiting other countries, which no doubt the minister has also visited, I know that forward prices have done wonderful things in giving the farmers security. I think it is quite possible for the government or the minister's department to enter into such a scheme, guarantee prices for two or three years, and give stability to everybody right along the line. Hon. members will realize the tremendous benefit it would be to hog producers, poultry keepers and dairymen if they knew what they were going to get, and that at no time would they have to take less but might get more. I cannot go further without getting into the question of prices and being ruled out of order, although I had prepared my notes to discuss prices. I hope the minister will tell us whether he does not think the time is ripe for us to have forward prices in Canada in order to give security to the farmer, the poultry producer, the dairyman and everybody else engaged in producing the necessaries of life for Canada.


Lewis Elston Cardiff: Mr. Speaker, I had no intention of saying anything on this bill, but I should like to say that I have read the bill carefully and will vote for anything that will be of benefit to agriculture in this country. The farmers have never got too much. However, looking at the bill I cannot see that it will be of very much benefit to them because of the fact that there is no assurance that producers will be accorded representation on the board. When the minister replies perhaps he will tell us who are. going to be on the board. Looking at the bill it is evident that all the authority rests with the minister and the

governor in council, the cabinet. If they are going to have full authority under the measure then of course we will only get what they want to give us. If we cannot have a producer member on the board I do not think the legislation will be of much benefit to us. I hope when the minister replies he will give us some assurance that we will be taken care of.
Something was said about the reason why pork dropped approximately 25 per cent in price earlier this fall. I was told by a very good authority that the reason that pork dropped was not because of the quantity on hand but because packing house lockers were empty. The price went down so they could fill up the lockers with cheaper pork. 1 cannot figure out any other reason, and I do not think those are very sound business methods. The producer is in the position where he must market his hogs. He cannot hold them. One fellow came to me and said: "I will not deliver my hogs; I will not market them." I said, ''What are you going to do?" He said, "I will turn them out to grass." That is all very well, but you have got to deliver them at a certain weight and you cannot hold them. You are caught both going and coming. The hogs must be delivered at a certain weight if you want to get a price for them. I do not think that is a good situation. Hogs should not take a slump of 7 or 8 cents a pound just at a time when perhaps a quarter of the production is ready for market. I think it is a disgraceful way of marketing anything. If the minister will tell me that producers are going to be represented on the board, then I have no fault to find with the bill; but if they are not, then I do not think it is any use at all. If the minister and the cabinet are going to exercise the whole authority then I am not satisfied with the measure.


Mr. A. Earl Calherwood (Haldimand):: Mr. Speaker, I should like to support the remarks of the hon. member for Huron North (Mr. Cardiff) and the hon. member for Selkirk (Mr. Bryce) that the producers should have membership on the board. I hope the minister will give us that assurance when he speaks. Generally speaking I think the setting up of this board will be an excellent thing for the farmers. There is no doubt that considerable power is being placed in the hands of the board. I had a call from a friend of mine in the seed trade who is concerned as to what this measure may involve. For example, if there is a shortage of seed in Canada the board may decide to bring in large quantities of seed from South American and Mediterranean countries. Such seed would be No. 1 grade and could be blended with
Agricultural Products Board Canadian No. 1 seed and sold as top grade. So far as freedom from weed seeds is concerned, this would be perfectly all right, but there is the important question of the germination of seed coming from these countries. We have to remember that the question of the rigours of our climate means a great deal in the percentage of germination of foreign seed. When the question of the appointment of the personnel of the board is being considered, I hope serious consideration will be given to the personnel. They should be men well qualified to study every angle of the great agricultural problems facing us. I want to add that one word, that serious consideration should be given to the personnel of the board.


James Garfield Gardiner: Mr. Speaker-


Mr. Speaker:: If the minister speaks now he will close the debate.


James Garfield Gardiner: I am sorry it will not be possible for me, without breaking the point of order I raised earlier-


An hon. Member:: That does not make any difference.


James Garfield Gardiner: -to answer all the questions or suggestions that have been made as to what I should say in reply. I think what is most important for me to say is that I believe the members of the opposition have been attributing much more importance to this particular board than was intended by the government or myself. As I understand it, the board really has no authority to settle any of the questions that have been discussed here. They only have one authority, and that is to buy and sell farm products when they are instructed by the government to do so. That is the only authority they have; they have no other authority. In order to make it clear that they can perform that service for the agricultural prices support board, the bill names the agricultural prices support board as one of the authorities for which they may act-with government instruction, of course.
The agricultural prices support board, as has been indicated, has the authority, and has settled upon a form of action which results in agricultural price floors. They are not satisfactory to everyone. But nevertheless, that legislation gives that authority. The setting up of this board does not take any of that authority away from the agricultural prices support board. It does not give to this board any authority to do that kind of thing.
The second last speaker, I think it was- the hon. member for Middlesex East (Mr. White)-suggested that he is not in favour of bulk buying. There is not much use of

Agricultural Products Board arguing the question as to whether you are in favour of bulk buying or not. There are certain countries that will not buy in any other way; and if you want to sell to them, you are going to sell in bulk or not at all. It just so happens that one of those countries is one to which we are most anxious to sell. Under the new government there we do not know whether they are going to pursue that policy. We know, however, that under the government that has just gone out they pursued that policy. One of their contracts is a meat contract with Australia for fifteen years. Of course, the question arises with those who are in authority now: What are we going to do about that contract? It is there; and there are other contracts ranging from that fifteen years down to four years. The only relationship that this board has to that situation is that the British had already indicated to us, before the change in government, and that representation has been continued since: "Would the government be prepared to buy farm products for us in Canada if we were to ask them to do so"? In so far as this measure is concerned, all we have said is: We have a board that can do that, if you want it done. That is what it really means. If they came to us and said: We want to buy certain things, we wish to buy them in Canada but we do not wish to go to the trade and we would like to have the government buy them, we will say: This board can buy them for you.
But under this legislation we do not intend to go into the business of buying farm products and selling them. That is not the intention at all. The intention is simply to have there a board which, when there is a job of that kind to be done, can do it.
In order to indicate that is the position, I would call attention to the fact that there is in this bill few of the powers that we had in the legislation, or even in the orders in council, under the War Measures Act, which made it possible for us to set up the dairy products board, the meat board and the special products board. Under either the orders in council or the legislation at that time we had authority to go and take the product out of the packing houses or even to go and take the product off the farms. We did not exercise the right to go and take it off the farms but we did exercise the right to go and take it out of the packing houses, and we exercised the right to take cheese out of storage and all that kind of thing. None of that authority is given to this board. It has none of those rights because, under our constitution, in peacetime we have no right to give to a board that kind of authority.
All we are saying in connection with this act is that where, for one reason or another,

it is necessary, this may be done. There may be a dozen different reasons; the only one we have felt it necessary to act upon up to the moment is that which necessitated buying some butter outside Canada, and this board is doing that on instructions from the government. Other circumstances could arise. I am not going to try to guess at what they are.
In order to answer the question that was just raised as to whether the board should have farmer representation on it, I am only going to answer with the same answer as I gave at the time we were setting up the original board to deal with agricultural floor prices or what is properly known as the Agricultural Prices Support Act. We were then asked to put on that board representatives of the producers. I took that matter to the Canadian Federation of Agriculture and I asked them which they would prefer to have, the chairmanship of that board or representation on an advisory committee. We were quite prepared to appoint their president, Mr. Hannam-and he is still their president-chairman of the board. They took that matter back to their board and discussed it, and they told us that they much preferred to be represented on an advisory committee and not on the board that was doing the job. They said much the same as was said here by one of the members a few minutes ago- I think it was the hon. member for Selkirk (Mr. Bryce)-or as was implied by him in what he said, namely that if you put, let us say, Mr. Hannam on the board, and he remains there for five or ten years, people will start to say that he is not a farmer at all but that he is just a government employee. That is what would be said, because that is what has been said about every person who has been put on and kept on boards. The federation made the choice. They said:	Set
up an advisory committee and give us representation on it; make it possible for that committee to be called together at their request from time to time; we would much rather have that than have a member on the board. That is the way we have been operating. Mr. Hannam is the chairman of this advisory committee. He was made chairman because he was the president of the Canadian Federation of Agriculture. They have been allowed to nominate nine, I think it is, out of the sixteen members of the committee. Then the provinces have been allowed to nominate members. The result is that by far the greater number of those who are on the committee are deputy ministers from the provinces or representatives of farm organizations across the country. Every time they have indicated a desire to be called in here-and they indicate it through the chairman, Mr. Hannam-they have been called in. They have set a date

which was satisfactory to us and to them, they have come here and advised us on every important action that has been taken from that time down to the present. I suggest that none of those who are closely associated with that organization will suggest that this procedure ought to be changed. But that applies more to boards that are settling these matters of policy which members have been concerned about, and I am quite sure that the farm organizations would be the last to ask that farmers be put on this particular board, because we do not know whether this board is going to operate to any great extent. The board, as it is operating, has been operating under order in council, under the measure we put through last year which was set up under the Department of Trade and Commerce. We had the right to appoint various organizations as emergency organizations. This one was appointed as an emergency organization to handle butter. It is assumed that there will be other operations that will need to be handled. The board was named under that authority. It consists of Mr. Pearsall, who was chairman of the old meat board; Mr. Chagnon, the vice-chairman; Mr. Nelson Young, director of production, as a member; Mr. W. C. Cameron, who is at the head of our dairy branch, as a member, Mr. Wheeler and Mr. Berry. Those men are all members of the staff of the department. There are no salaries to be paid out. They are simply there in case it is decided, perhaps over a few months, to buy some particular product. They are not operating as a buying and selling board. They are simply there as a group that could be called together and asked to buy a commodity for the time being in order to serve some purpose, or deal with some condition brought about through the administration of another act, or another operation within the department or some other department.
Now I repeated that in order to show that the board has not the important function that might be indicated by the language that has to be used in setting up a board of that kind. Certainly, the board has to be given the authority to buy and sell. But it is set out very carefully in the act that they cannot buy and sell at all unless they are asked to do so by the government, not by the minister, but by order in council. That is the only way they can buy or sell anything. They are not set up to buy and sell any farm product from day to day. I would suggest again that the board is not nearly as important as has been suggested in this discussion.
I do not believe it would be possible for me to discuss what has been said to any 94699-132J
Agricultural Products Board greater extent without getting into the position of discussing something which is not covered by this bill. When we get into committee, if there is any information desired about farm prices and the sale of farm commodities that it is proper members should be asking for, I am quite prepared to answer those questions. I do not believe I would be pursuing correct procedure if I were to enter into a general discussion of those other measures, and other activities under other bills, in the manner that has been followed by some of those who have taken part in the debate. I again move the second reading of the bill.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Dion in the chair.
On section 1-Short title.
Percy Ellis Wright: On section 1, I should like to comment on statements which have been made by some of the members about the bulk buying being carried on by Great Britain. I should like to direct the attention of this committee to the fact that bulk buying was not started by the Labour government. It was started by the coalition government during the war, was continued by the Labour government, and is still being carried on by the Conservative government in Great Britain, Evidently they believe it is the best method by which they can obtain their supplies. There are certain other questions I want to ask, but I shall leave them until we come to the appropriate sections of the bill.


Mr. Blackmore:: Will the minister state whether or not this bill has as its major function the finding of markets for Canadian products? Is that intended to be part of the work of the board set up under this bill?


James Garfield Gardiner: No, that is not one of the functions of this board at all. Of course, it is the general function of the marketing branch of the Department of Agriculture and the Department of Trade and Commerce as well, but this board has not that authority.


John Horne Blackmore: Why then is the provision made for buying and selling?


James Garfield Gardiner: Let us take the one product, butter. If butter is bought, of course it is going to be sold. We are just bringing it here for the purpose of seeing that it is sold. It is brought to Canada because our supply is short. The board has the authority to sell, and may do that by simply selling it to some branch of the trade which will distribute the butter to the public.


John Horne Blackmore: It is just a sort of agent for doing a job?

Agricultural Products Board


James Garfield Gardiner: That is all.


[Stage Direction]
Section agreed to.
On section 2-Definitions.
Mr. McLure:: Various products are set out in section 2. Will the minister state whether conservation furs come within the definition of "agricultural products". There is no mention made of them, and they are now under the prices support act.


James Garfield Gardiner: In so far as we have assisted in the marketing of furs, they have been handled under the Agricultural Products Cooperative Marketing Act of 1939. Under that measure we have guaranteed accounts at the bank. The act permits us to guarantee the account of anyone who comes under that act up to 80 per cent of the average price of the preceding three years. In actual practice, I do not think the board has ever agreed to a price higher than 60 per cent of the average of the preceding three years. We did guarantee the price of furs up to a set amount in 1947-48, at which time we took a considerable loss. Speaking from memory, I think the proportion of the price at that time was somewhere between 40 and 50 per cent. Prices were so high during the latter part and at the end of the war that there was a loss on those furs. So far as I can recall, furs have been handled under that act, and are still handled under it.


Winfield Chester Scott McLure: I understood the minister to say the board took a loss, but the producer took a tremendous loss. It costs 50 per cent more to produce those furs today than it did in 1939 or 1940. The cost of everything, such as labour, food and so on, has caused that increase in the cost of production. No farm can produce today except at a loss, that is with the prices that are realized under this market support act. I thought if some changes were going to be made, consideration might be given to bringing this product under this act and treating it in a different manner from that in which it has been treated. The method now being followed is of no benefit whatever; in fact it is injurious to the trade.


[Stage Direction]
Section agreed to.
On section 3-Board established.
Lewis Elston Cardiff: When it is stated that the board will consist of not less than three and not more than seven, why is there not a definite number set out in the bill?


James Garfield Gardiner: At the moment we think it is best that the three groups that were represented on the previous three boards should be represented on this board. In case we are dealing with a dairy product, we think a


dairy man should be on; in case we are dealing with meat products, then we think a meat man should be on, and to keep all of them represented it requires seven.


Lewis Elston Cardiff: In that event the minister can call in anybody he wishes.


James Garfield Gardiner: Yes, or any part of it.


Percy Ellis Wright: A little while ago when the minister discussed this matter he said he had discussed it with the Canadian Federation of Agriculture on a previous occasion, and they had indicated that they would prefer to be represented on the advisory board rather than on the main board itself. I should like to bring to the minister's attention a criticism that is frequently raised in the country, and I should like to know whether it is justified or not. The growers' representatives from the various farm organizations who are on this advisory board, and who sit in with the main board in discussing questions that may arise as to whether the product should be brought under the board or as to what the price is, are sometimes criticized. The criticism that I hear in the country is that, having sat in on the discussion, these men are not able to come back and freely express then-views before their own organization, because their hands have been more or less tied by the fact that they have discussed the matter with the government. There is considerable criticism of members of some of these advisory boards by the growers themselves because of the fact they feel that their representatives have more or less tied themselves to a certain position and cannot come back and freely discuss that position with their growers or with the body whom they represent. Are these men who are on these advisory committees of the two boards in any way prevented, through being members of these advisory boards, from coming back to the producers and fully discussing their position on the advisory committee with regard to matters that may have been discussed between them and the government?


James Garfield Gardiner: The committee is set up with a full understanding and in such a manner that the members are advisory not only to the department and through the department to the government, but they are intended to be advisory as from the department to farm organizations represented and the provincial government represented. What they expect me to do, and what I do, is to open the meeting and give them all the information that I can properly give them with regard to what we know about the marketing situation in different places, probably the information

that has come to us from provincial authorities, or from authorities in some other country as to what the position is.
We have had an understanding from the beginning that while these discussions are on a great many things may be said on both sides that should not be spread indiscriminately around the country. We could not give it if it were going to be spread around the country, and they would not be in a position to advise if they did not have all the facts, I must say that over the years, I think beginning back about 1944, down to the present, there has never been an occasion that I know of when anyone came out of that committee and said anything they should not have said, and that is a rather remarkable experience. I think they will agree too that no member of the departmental staffs, including myself, has gone out and repeated anything that they have said, that they might, after getting all the facts, have thought that probably it would have been just as wise not to have said. The committee is not conducted in that way. They all sit down behind closed doors for the time being, and do discuss the whole matter, and it is fully understood that the decisions which have been reached there, and the information that they are finally given by the government after the discussions -at the end of these considerations I come back and discuss the matter with them after they have spent two or three days in threshing out all the questions that they think should be threshed out-they have put their representations in front of me and I go over each one of them and tell them pretty well what I think can be done in the circumstances, or what may be done. They then are in a position to advise either their provincial governments or the farm organizations they represent as to what the position is. That is the principle on which we operate. It has not been said to anybody: "You must not say this, or you must not say that". There is a general understanding that we think we know one another's point of view on it, and we think we know when something has been said that other people would perhaps prefer not to have repeated as having come from them directly. Therefore we do not repeat them. That is the only sense in which there is any restriction.


Mr. Charlion:: Just a word, but before I say that I do wish to say that I appreciate the assurance the minister gave this morning-at least I thought he did, if I heard him correctly-that this board would not in any way interfere with the producers' boards now in existence or organized in the future.
Agricultural Products Board


James Garfield Gardiner: That is correct.


John Alpheus Charlton: He did make that statement, and I thank him for it.
With regard to section 3, I should like to say a word on subsection 6. It has been quite apparent in the last few years that the government does want to take away from the civil service commission the right to hire men and fix salaries. In view of the fact that number 7 is here, that the members of the board, as I understood the minister to say, were now civil servants in his department, I see no reason for number 6 being there. I think it should be deleted. It changes all the principles of the Civil Service Act as it now stands. I do not believe in the principle that the governor in council should have the privilege of picking men and giving them jobs and setting their salaries, all outside the Civil Service Act.


James Garfield Gardiner: There is only one reason for continuing it in the bill, and I think it is a good one. We have no reason at the moment for thinking that there should be anyone on the board who is outside the civil service. There is always the possibility that there might be some product to be dealt with that is not a product over which we have sufficient control to be able to feel that our officials should handle it. We may desire to go outside to some farm organization that really has control over the product. Just by way of illustration-I may be introducing something with which I may be confronted later and asked to appoint someone. A question was raised just a few moments ago by an hon. member from Prince Edward Island with regard to furs. There is just a possibility that if someone were to say to us: "We would like this board to buy furs", we might not think we had anyone in the department capable of handling that matter, and we might ask somebody to sit down with the board to deal with that. In that case we would want to provide for some payment. That is the only reason it is there. In addition to that we may have it develop into a sufficiently onerous job to be giving to some official in the department far more work than he should be asked to carry without any additional pay. Then there might be something added to the pay he is receiving. I think the section should stay there to deal with these matters, but I can assure the hon. member that I will not be able to get any considerable payment for any of those who are already on the civil service staff past some of my friends, including the Minister of Finance.
2080	HOUSE OF
Agricultural Products Board


John Alpheus Charlton: The statement does not answer the question. Surely in the case of furs the minister would not hire a man to go on that board.


James Garfield Gardiner: Perhaps one would hire him ior a few months.


John Alpheus Charlton: You could hire a specialist for a month. That would be better than hiring a man to go on the board for the entire year.


James Garfield Gardiner: We would have to pay him, whatever the length of time was.


John Alpheus Charlton: Well, that is an altogether different thing. This subsection says that the governor in council may fix the salaries or other remuneration of members of the board. He would not necessarily be a member of the board. An expert who would be hired to give advice as to the grades of furs, and things of that kind, would not necessarily be a member of the board. But subsection 7 of section 3 says:
Officers, clerks and employees required for the proper conduct of the business of the board shall be appointed in accordance with the provisions of the Civil Service Act. But the minister may require any officer, clerk or employee on the staff of the Department of Agriculture to serve on the staff of the board without additional remuneration.
The minister has just said that he might have to give them more; and yet in subsection 7 it is made clear that he cannot give them any more. They must work for the salary they are receiving now as civil servants.


James Garfield Gardiner: The other remuneration
might be only expenses.


John Alpheus Charlton: Oh, if the minister is going to add to salaries by paying expenses-does he mean under the table?


James Garfield Gardiner: No, you do not get anything done under the table around here.


John Alpheus Charlton: If it is to be by way of expenses, we know that most members of the board and of the Department of Agriculture get travelling expenses now. What other expenses would they have?


James Garfield Gardiner: I suggest there is no use of our discussing that question here, because neither of us can settle it. The point that is important here is that authority is given to the governor in council to do something that is absolutely essential.


John Alpheus Charlton: As I see it, the two subsections are absolutely opposed to each other. One subsection said more cannot be given, while the other subsection says something different.


James Garfield Gardiner: No; one deals with officials and the other deals with members of the board, who may not be official. There are other members who think that there ought to be members on the board who are not officials. At the present time I do not think we need any; but if it should develop that we did, it would give us authority to make the appointment.


Percy Ellis Wright: I appreciate that in discussions which take place between the advisory committee and the board there may be certain confidential information given to the board. There may be arguments the government may use to the board that they do not want to have used by the advisory committee. But I am still of the opinion that unless these advisory committees are able to go back to their producers and give a fairly accurate resume of the discussion which has taken place between them and the various boards they meet, the growers of the particular product an advisory committee represents are not going to be satisfied.
This argument has been brought to my attention often, that an advisory committee is being tied by the discussions in such a way that, because they think what they have been talking about is of a confidential nature, they are not free to come back and give a full report of what the conditions actually are.
I am all for these boards, and for this method of handling our agricultural products; but we want to see it done in such a way that the confidence of the growers can be maintained. The only way they can be operated successfully is to maintain the confidence of the growers in connection with the methods being used. That can be done only when these advisory committees are free to come back and discuss with the producers the arguments used both by the government and by themselves in the presentation of the case to the board.


[Stage Direction]
Section agreed to.
On section 4-Powers of the board.
John Alpheus Charlton: What has the minister in mind in paragraph (e) where it refers to storing, transporting or processing, or entering into contracts for the storing, transportation or processing of agricultural products? Has the minister any idea as to what the board may do in connection with marketing some product that must be processed before it is marketed? Or does he want to have that provision in there only because he might wish to use it some time?


James Garfield Gardiner: As has been said, the only product we are handling at the moment is butter. When butter enters Canada it has to

be stored. It comes in in bulk, and has to be processed to the extent of having it put into pound packages. That could be considered processing.
That is all the paragraph refers to-that kind of thing that must be done in connection with the actual handling of a product.


John Alpheus Charlton: Is there anything else in the minister's mind? After all, packaging butter is not processing it.


James Garfield Gardiner: We have no intention under this measure of going into the packing house business, if that is what the hon. member has in mind. It is just simply a matter of making arrangements to have a product stored.


John Alpheus Charlton: Then perhaps the minister has other services in mind?


James Garfield Gardiner: Only in so far as they are authorized to buy. For instance, if the British were to come here and say, "We want pork products, and we would like this board to buy them for us", we would probably go to the packing houses who are receiving pork from all over the country, and say, "Here is the price you can have, the price which has been offered for it;" and we would see that the transaction was carried through. In that way we would make arrangements to have the product frozen and stored and shipped, as would have to be done. But all the cost of that would be borne by somebody else, not by this board.


John Alpheus Charlton: I do not quite understand what the minister means.


James Garfield Gardiner: The board would do what the purchaser decided he wanted to have done. Whatever he wanted done he would have to arrange payment for. But the board would act in seeing that it was handled through the usual facilities.


John Alpheus Charlton: The board themselves would not do it.


James Garfield Gardiner: No.


John Alpheus Charlton: They would have the processor do it?


James Garfield Gardiner: Yes.


John Alpheus Charlton: What has the minister in mind in connection with this section of the bill? Ordinarily the board would not do it themselves. They would have the processor do it, would they not?


James Garfield Gardiner: They would have the authority to store it, for one thing. That is part of the process of transferring it from the producer to the consumer. Then they would have authority to pay for transport, and to
Agricultural Products Board enter into a contract for the storing, transporting or processing of the agricultural products. They would enter into those contracts on behalf of whoever was purchasing the pork. The government would not be purchasing it. It might be the government of some other country, or a buyer in some other country. But they would be paying for it, not this board.
In actual fact they would handle the financing, but they would get their money from elsewhere.


John Alpheus Charlton: This board has the power to go out and buy goods, build huge factories and process the goods themselves?


James Garfield Gardiner: If you will read the act you will see that this board really has no power to do anything. Someone was saying a moment ago that if this was just a matter of leaving power in the hands of the government they did not think very much would be accomplished. Well, that is what it does do. The board will not get any instructions under the bill to go into the packing house business.	[DOT]


John Alpheus Charlton: I have one further question in connection with subsection 2 which states:
The authority given by the governor in council and the direction given by the minister to the board pursuant to subsection one may be given generally or in any specific case or with respect to any particular matter.
Could the minister state where he would give a general order? Why does he want the word "generally" in the subsection? Ordinarily you would tell the board to go out and buy butter or cheese, but what would the general order be?


James Garfield Gardiner: Probably I should not put it this way, but that is not something that I wanted in there. You know, there are people, and naturally so, who want to place a little restriction on the minister and that section pretty well does that. If you read it carefully you will see that it is the governor in council that does the instructing. I do not think there is going to be any instruction given which can be criticized in any way.


John Alpheus Charlton: I do not see any restriction upon the minister in that section. It reads:
The authority given by the governor in council and the direction given by the minister-
That puts the minister in the same spot as the governor in council.


James Garfield Gardiner: You have to read that along with subsection 1.


John Alpheus Charlton: That reads:
Subject to the regulations, the board may, with the authority of the governor in council and under the direction of the minister . . .
That is a separate part.

Agricultural Products Board


James Garfield Gardiner: The minister is giving the directions as from the governor in council and he can give them in general or in specific terms.


John Alpheus Charlton: Subsection 2 reads:
The authority given by the governor in council and the direction given by the minister to the board pursuant to subsection one may be given generally or in any specific case or with respect to any particular matter.
The minister could give a general order to go out and buy all the agricultural products across the country.


James Garfield Gardiner: I do not intend to, and I am quite sure the government would not give me the authority to do that even if I did.


John Alpheus Charlton: I am not saying the minister intends to.


James Garfield Gardiner: You do not know the government.


Hazen Robert Argue: The main reason the government could not do that is that they have only $15 million. I do not think you could buy up all the agricultural products in Canada with $15 [DOT] million. This particular section seems to me to be the whole core of the bill. It provides that the board, directed by the government, may buy products in Canada. I have said already in this discussion that I think floor prices are exceedingly low, in particular floor prices under eggs and hogs. They should be increased and increased substantially. I think the minister should tell the committee and the country whether this board during the coming year will be in a position to buy agricultural surpluses, including those of eggs, hogs and butter. I think it is time a definite announcement was made as to what support will be given to bacon and egg prices in the future.
I certainly do not agree that the present floors are sufficient, but I think the very least the government could do with any of these floor prices is to maintain them.


James Garfield Gardiner: As hon. members know, there have been different methods followed in securing for farmers reasonable prices for their products. The floor price method is one, and that is followed in connection with butter. It has been followed in connection with pork products. I must say that at no time since we started to follow that policy under the Agricultural Prices Support Act have we found it possible to purchase any pork products. We started out with the position that the level of prices previously paid by the British government would be augmented-I am
[Mr. Charltoe

speaking just from memory-with a subsidy of $3 paid by the government.
At the end of that period we undertook to continue a floor of $32.50 on Wiltshire sides, and that still exists. There has been no indication from the government up to now as to when it may be discontinued. There is no date limit. It is set at $32.50 basis Wiltshire sides at Montreal. There has been no sale for Wiltshire sides at $32.50 since the floor price was placed on. Any price offered was considerably below the price at which pork was being sold in this country.
In spite of the fact that there have been no purchases, during that whole period there have been only one or two days-I would have to check the records in order to determine how many-when the price was below what we figure would be a proper relationship between the $32.50 and the price of pork. It just so happened that that was very recent. We have a standing offer to buy at a rate which is represented by the $32.50 for Wiltshire sides. I speak subject to correction, but I think that works out to about $27.50 at Winnipeg. It is true that the price was down for a day or so to $26.50 or some such figure, but I have no doubt that the fact that there was an offer to buy around the other price resulted in the price going back to where it was, $27.50. It has gone even higher than that.
If it were necessary to buy up that product the government might say to this board, "You buy it and turn it over to some purchaser, whether it be the British or someone else." That would be the natural thing to refer to this particular board. But for the last two years we have not had any of it offered at that price.
We do not follow the policy of establishing a floor price as on pork in connection with eggs. Two years ago we came to the conclusion against the opposition of many people that we could serve the poultry producers, and particularly the egg producers, much better by simply taking part of the risk out of handling eggs. When the British stopped buying eggs two years ago the price went down to sixteen cents a dozen in some parts of Canada. At the end of the six weeks when the market was open we said that at the end of the year we would take all the eggs in storage at 38 cents a dozen. We told the trade and the producers to go ahead and handle their own affairs, but at the end of the season we would take the eggs in storage at 38 cents a dozen. Eggs have remained above 38 cents all the time.

I must say that at times there has been far more criticism of the heights to which they have gone than there has been of low prices since. A year ago when the question was up for consideration those who represent the producers and handlers of eggs came to my office and unanimously asked us to continue the same policy for another year. We did so.
I was waiting for an appropriate time to be able to announce what we are going to do in the coming year, and I think this is as good a time as any. We have had representations again this year from all across Canada, and the question was fully discussed at the agricultural conference held in December. The vice-president of the Canadian Federation of Agriculture, speaking for the federation because the president was not there, said definitely they were of the opinion that the price should not be set at less than 38 cents. Of course he would not object to its1 being set higher, but it was their considered opinion that it should not be set at less than 38 cents, or in other words that we should not lower it. That was on the very day eggs dropped 12 cents a dozen in Ottawa. Those representations were after they had dropped 12 cents.
What we have decided to do is continue the same policy for 1952 as we had through 1950 and 1951; namely, at the end of the season we are prepared to buy all "A" large eggs which are in storage at Montreal on a basis of 38 cents. The prices range up and down across Canada from there. Therefore we are not changing the policy at all, and we think it would be bad practice to change a policy which has worked so well as the one I have been discussing. In order to indicate how well it has worked I want to point out that the average wholesale price of grade A large eggs at Montreal in 1943 was 45 cents a dozen. In
1944	they sold at 41 cents a dozen, and in
1945	at 43 cents a dozen. The average for the first eleven months of 1951 is 67-4 cents per dozen. That is not bad, of course; and that is under the policy we are now following. I might say that at present the price is 55 cents.
In order to give the whole table at one time I think I might just as well continue. The figures for cheese, No. 1, are 1943, 22 cents; 1944, 21 cents and 1945, 21 cents. The average for the first eleven months of 1951
Agricultural Products Board is 37-5 cents. I would point out that the question raised by the hon. member for Brant-Wentworth a few moments ago is involved there. Cheese is now handled under a producers board in the province of Ontario, and of course we would not interfere in any way with that handling. As a matter of fact we have not only co-operated with them but advised very strongly that it be handled that way. The figures for butter, No. 1, are 1943, 36 cents; 1944, 36 cents, and 1945, 37 cents. For the first eleven months of 1951 they run from 61-6 to 68 cents a pound.
Then I come to whole milk prices to farmers at dairy, per hundredweight. The exact figure for 1943 is not here, but for 1944 it is $2.50 and for 1945, $2.50. For the first eleven months of 1951 it averages $4.32. For B-l hogs the figure for 1943 is $16.94; 1944, $17.25 and 1945, $18.20. For the first eleven months of 1951 it is $33.88 per hundredweight. For fancy B.C. McIntosh apples the figure for a 42-pound box for 1943 is $3.36; 1944, $3.07, and 1945, $3.46. This is the first product for which the price was lower in 1951 than in the three years at the end of the war. It is $2.94, but I would remind the committee that in that period the government was giving considerable assistance, because of conditions that existed during the war, in order to bring about the prices to which I have referred.
Then I come to potatoes. For 1943 the figure is $2.26; for 1944, $2.33, and for 1945, $2.57. For the first eleven months of 1951 it is $2.19, but at the present time it is $4. I could review the prices at the present time for the others, but only in respect of potatoes is there sufficient variation from the average for the first eleven months of 1951 to make any considerable difference in the answer that might be given to these questions. That is the present position, and I would only say in conclusion with respect to eggs, about which I was specifically asked, that we think the policy we have followed for the last two years, and which has brought about the results I have indicated, is not one from which we should lightly depart in so far as the interests of the producer are concerned.


William Scottie Bryce: I should like to ask the minister a question.


James Garfield Gardiner: As a matter of fact I might say that the hon. member for Melfort asked for all the figures with respect to the first three years I have mentioned, and I added the others.


Major James William Coldwell: Will you put the whole table on the record?
2084

Agricultural Products Board Mr. Gardiner: Yes. The table is as follows:
(1) Commodity	(2) Unit	(3) Average Wholesale Market Price at Montreal	(4)	1943	1944	1945	Average 11 months 1951*	Latest quota- tion$ cts.	$ cts.	S cts.	$ CtS;	$ cts.(a) Eggs Grade A Large	dozen	0.45	0.41	0.43	0.674	0.55 Dec. 11(b) Cheese No. 1	lb.	0.22	0.21	0.21	0.375	0.37 Dec. 15(c) Butter No. 1	lb.	0-36	0.36	0.37	0.616-0.68	0.665 Dec. 15(d) Whole milk price to farmers at dairy	cwt.	2.50	2.50	4.32	4.50 Dec. 15(e) Hogs-Bl carcasses	cwt.	16.94	17.25	18.20	33.88	29.60 Dec. 12(7) Fancy B.C. McIntosh apples	42 lb. box	3.36	3.07	3.46	2.94	none\g) Canada No. 1 N.B. Potatoes	cwt.	2.26	2.33	2.57	2.19	4.00 Dec. 15
* Are average of monthly prices,-not weighted average.


William Scottie Bryce: The prices the minister has quoted are dealers' prices. They are not the prices to the producers. Am I right?


James Garfield Gardiner: They are wholesale prices.


William Scottie Bryce: Have you the prices the producers received? That is what we are really interested in. We are not interested in what the dealer gets.


James Garfield Gardiner: I am sure the hon. member for Selkirk, who is a practical farmer and who delivers products to the Winnipeg market, will readily agree when I say it would be absolutely impossible for me to go across Canada and get the prices at which these products are sold in every community. It just could not be done. There are, however, estimated averages worked out which are available, and they bear a reasonable relationship to these prices.


William Scottie Bryce: I do not want to take up the time of the committee, but why continually look after the dealer? Look after the man who is producing the goods.


Hazen Robert Argue: I was very pleased indeed to hear the minister's announcement that the government is going to continue the present support prices for eggs and bacon for another year. I am only sorry the minister and the government have not agreed to increase the floor price.


James Garfield Gardiner: Before the hon. member goes on I should have said, and I want to say it
[Mr. Coldwell.l
now, that the floor price for butter was set last year for two years. In the meantime we increased the amount we were offering from 58 to 63 cents. That has been allowed to run indefinitely, and we have not received butter. We got about 280,000 pounds at that price, and that is all. The price of 63 cents has run along to date.


Hazen Robert Argue: I am glad to have the minister's further explanation. As he said, the figures he gave the house are averages of the prices prevailing throughout the year. The difficulty with them is that while they appear fairly high, the price for hogs, shall we say, is high when hogs are not coming on the market, and in the fall period when they are coming on the market you have a lower price. A much better policy for agriculture would be a floor price raised or lowered from time to time as farmers' costs of production go up or down. If there were a more adequate floor price for eggs I do not think we would see egg prices reaching the high peaks they have reached over the last year. If the government raised the floor price, it would thereby stimulate production, and that increased production would stop egg, hog, and other prices from going very high. The price the minister has stated is an average price over the year. But for the farmer, the price he receives is highly fluctuating and highly unsatisfactory. In the Saskatoon Star-Phoenix the other day I read that the quoted price for grade A large eggs is now 38 cents in Saskatoon. With the floor

price of 38 cents a dozen for grade A large eggs at Montreal, that 38-cent price at Saskatoon can go down a good deal further. After other expenses are deducted the price to the Saskatchewan producer can probably go down to as little as 20 cents a dozen, with the present floor price.
Once again I say that, as far as I am concerned, I am glad the government is staying in the price support field. My only wish was that the prices had been adjusted to take care of the increased cost of production since 1943-45. In those years, 1943-45, because of the British contracts the price for hogs averaged out to $22.25 for Wiltshire sides. Since that time, on the minister's own statement, the cost of production has gone up by 60 per cent. If the farmer is to have the same comparable floor today the price should be $35 or $36 a hundred for Wiltshire sides, with a further increase in the premium. Under the present floor or support price there is no incentive for the farmer to go into the production of hogs, if in the future- as happened this year-the price is going to drop 25 or 30 per cent when the farmer is sending his hogs to market.


John Alpheus Charlton: I should like to add something further to what the hon. member for Assini-boia has just said with regard to floor prices. Now that we are on subsection 5 of section 4 I guess we can say something about floor prices. The floor price of eggs is absolutely no guarantee at all to the producer of eggs. The only thing it guarantees is that the buyer of those eggs from the producer will get 38 cents plus his storage costs. The plant that buys the eggs from the producer can pay the producer whatever it pleases. It can pay him 20 cents. Still there is no guarantee by this government to the producer of eggs; not a particle.
The minister made a statement with regard to the average prices of products. The average over a year does not mean a thing. As the hon. member for Assiniboia has just said with regard to hogs, when they are high in price, none are coming on the market or if there are, they are few in number. Then when there is a flood of hogs coming in, the price is low. The average is not figured on the basis of how many hogs are coming in. Average prices do not actually mean a thing to the producer. Hogs and eggs are what you might call perishable products. I do not mean to say that the hog is going to spoil if you keep him an extra week. What I mean is that if the producer keeps a hog past the weight when it should be marketed, he is docked probably $5 for doing so. The hog has to be marketed at the time it is of the correct weight, just
94699-133J
Agricultural Products Board as the egg has to be marketed when it is fresh. It cannot be kept by the producer for a couple of weeks until the price goes up. Just this fall, at sales or in similar places, I heard a great many producers and farmers make the statement that they were through producing eggs and hogs for that very reason, namely that they had nothing to say about the prices they received, and the product had to be marketed at a particular time.
As to beef cattle or dairy cows, you do not have to sell them today or tomorrow; you can keep them for a month if you want to, or for a year. But as I have said, the situation still is that, as to hogs and eggs particularly, those products have to be marketed at the time they are ready to go to market, and they cannot be held. Therefore, as I have said, the average price does not mean a thing.
The farmers in this country want floor prices. The government is maintaining floor prices on some products, even though we feel they are too low to keep production up to a point which we think is safe even for Canada. Along with that floor price we will accept the ceiling. As producers we think it is a good idea not to have prices go too high because if the price of a product goes too high, the consumer will be forced into another market, an event which is actually to the detriment of the producers of that particular commodity. If the farmers or producers of the country are to be put in that position, then why should not other classes of the community be placed in the same position? In effect this government is guaranteeing, by tariffs, a floor price to industry. Nobody can argue that point. There is a guaranteed floor price to industry across the country. But does the government hold the ceiling? No, there is no ceiling on those products. Yet there is a ceiling, or a practical ceiling, on farm products. When the government puts both classes in the same category I think the farmer will be happy.


Victor Quelch: Mr. Chairman, I want to say a few words with regard to paragraph (e) of section 4. We have heard a great deal lately from officials of FAO to the effect that the production of food in the world is barely keeping up with the increase in population; and they are calling for the highest possible production of food by the various nations. Is the government anxious that the farmers of this country increase their production of food to the highest level, that is, along special lines? If the farmers do that, have they any assurance that, if any surpluses occur the government will find a market for them? If that surplus is of a commodity that is
2086	HOUSE OF
Agricultural Products Board perishable, have they any assurance that the government will then provide for storage or for the processing of that commodity so it can be kept over until such time as it may be made available to a nation that needs it?
The minister may say that the United States did a good deal of that sort of thing last year, and that some of the products that were processed deteriorated on their hands. That is true; but the United States did not make those commodities available to many nations that would have taken them, provided ways and means had been worked out to make the transfer. Last year FAO faced that problem. A special committee was set up to find ways and means of making this surplus available to nations that required it, and it proposed an international commodity clearing house. Canada voted against that proposal. If I remember rightly the Minister of Agriculture was one of the delegates who voted against that proposal; and one of the reasons he gave was that there in that proposal nothing that could not be carried out by Canada on her own as an individual nation. So we come back to the question: in the event of any surplus occurring, is Canada prepared to find ways and means of getting that surplus food to the nations that require it, even though we have not the type of exchange we want in return? Again I come down to the point: is the government today asking the farmers of this country to expand their production to the highest level possible with the guarantee that if they do so they will not be penalized by having surplus goods left on their hands?


James Garfield Gardiner: Mr. Chairman, I do not
know that I would speak on the question were it not for the fact that at least two or three members have made much the same statement just made by the hon. member for Acadia. The fact is that from the time FAO was first set up the government of Canada supported Sir John Orr in his proposal, which was along the lines of the suggestion which has been made by the hon. member for Acadia and others. I believe that on two occasions, probably three, I was the representative of this country and the government's position was clearly stated as being favourable to Sir John Orr's proposal. Then there was the Washington meeting to which reference has been made. I have not given the answer at any time that Canada could do the job as well herself.
The statement I did make bad to do with wheat, and it was to the effect that Canada had carried 600 million bushels of wheat throughout the last half of the war, and not at the cost of Canada but at the cost of the

wheat grower. My statement was that if 200,000 farmers in Canada could carry 600 million bushels of wheat, surely a group of nations could carry the comparatively small amount which they would be required to carry in order to take care of the surpluses that might occur elsewhere. It was that argument that we advanced. In the face of that argument the countries that were most capable of financing any such proposition refused to do so. All Canada ever did in the matter was to say that it would be an impossible position for (Canada to head a group of nations who would find it impossible to finance such a proposition, so Canada could not vote for something she could not possibly carry out. Canada voted against that. We still maintain that if all the countries of the world, and particularly those most capable of financing, wish to follow such a plan, then Canada would be in a position to consider the matter again and express her point of view with regard to it. But so long as the situation is that those who might be expected to do the greater part of the financing are opposed to it, Canada certainly is not going to step in and try to finance alone the feeding, let us say, of the suffering people in China. That is all that has been said. The position Canada has taken from time to time has made that quite clear.
We are saying to the farmers of Canada, go ahead and produce for the markets that are available. The farmers are doing that rather successfully, and they are getting a fair return for what they produce.


Percy Ellis Wright: I am very pleased indeed to have that' statement about Canada's position, because I am afraid the minister's position with regard to the Washington meetings has been misinterpreted.


James Garfield Gardiner: My statements have always been misinterpreted by certain people.


Stanley Howard Knowles: Whose fault is that?


Percy Ellis Wright: Whose fault is that? If the minister reads his own speech he will find it is not very clear.


Mr. Harkness:: The minister often misinterprets himself.


Percy Ellis Wright: The minister has made a statement in this house that in the setting of floor prices-if the minister would talk to me instead of someone else-


James Garfield Gardiner: I have heard what you have to say so often that I know what you are going to say.


An hon. Member:: The minister made a statement in Regina.


Percy Ellis Wright: He says too much where he should not say it, and not enough where he

should. The minister made a statement in this house that in the setting of floor prices the government had regard to the prices which obtained between 1943 and 1945. Just a few minutes ago the minister put certain figures on the record, and I have some figures here in the form of a return. These figures show that in the years 1943-45 grade A eggs averaged 43 cents a dozen. The minister has told us that the government has set a floor price for the packers or buyers of those eggs-


James Garfield Gardiner: That illustrates exactly what I said a moment ago. My friend is misinterpreting me-


Percy Ellis Wright: Is the minister making a speech or stating a point of privilege?


James Garfield Gardiner: I am speaking to a point of privilege.


Percy Ellis Wright: Then perhaps you should say so.


James Garfield Gardiner: I just stated that there is no floor under eggs. We are not setting a floor price there, from day to day as we do for butter. We are saying that we will buy any eggs that are in storage at the end of the year at 38 cents a dozen.


Percy Ellis Wright: You are buying eggs at the end of the year that the packers may have in storage, or that anyone else has in storage, at 38 cents a dozen. In effect, that is setting a floor for the packers or the other people who have their eggs in storage.


James Garfield Gardiner: Including the member for Melfort, if he has any.


Percy Ellis Wright: There is no doubt about that, because you say you will purchase them at that price. This price bears no relationship to the statement that the 1943-45 period will be used in establishing floor prices for agricultural products. If the floor were established on that basis, the average price for those three years was 43 cents so the floor would be at least 60 per cent higher than that.
The minister has made the statement that he listened to the representations of the egg producers. He indicated to this house that they were satisfied with the 38 cents the government guaranteed to the packers at the end of the year. Did those people who made the representations on behalf of the producers not ask for anything more than that? Were they satisfied?


James Garfield Gardiner: They did not say anything about the packers at all. We did not guarantee the packers.


Percy Ellis Wright: That is not the question I asked. Were they satisfied with the 38 cents guaranteed to the packers?


James Garfield Gardiner: You said more than that.
Agricultural Products Board


Percy Ellis Wright: I am asking for an answer. Since there is no answer, I take it that the producers were not satisfied. But they would be satisfied if the minister put into practice what he stated should be the guiding principle of setting floor prices, that is using 1943-45 as a guide.
In this statement he has given me it says that British Columbia McIntosh apples averaged $3.25 a box during that period. When it came time for the government to put a floor price under apples they certainly did not use the 1943-45 formula. The statement shows that Canada No. 1 potatoes averaged approximately $2.40 during that period. If my memory serves me correctly, when the government placed a floor under New Brunswick and Prince Edward Island potatoes it was approximately 75 cents, and did not bear any relationship to these figures.
In this return which I have in my hand the support price in December of this year for Wiltshire sides at Montreal is quoted at $31.04. I want the minister to tell me just how the disparity arose between the $32.50 which he has been quoting and the $31.04 which is shown on the return.


Joseph-Alfred Dion: Shall the section carry?


Percy Ellis Wright: No, I asked the minister certain questions. I want to know if he can explain these differences.


James Garfield Gardiner: I do not think I should have to answer the question three or four times.


Percy Ellis Wright: The minister has never
answered this question, because it is the first time I have asked it.


James Garfield Gardiner: If my hon. friend will read the statement I made a few moments ago he will find an answer to all the questions he has asked. When he asked for that return, if he had asked for all the information he is now asking about, he would have got that information. That was not what he asked for. He asked for prices, which would make it possible for him to use certain arguments. I have given the committee that information and it will be on Hansard, and I feel it will answer all that has been said with the possible exception of the reference to potatoes and apples. I might say in that regard that the price received by the producers of apples in those war years was to a very large extent the amount which was put up by the government to support the price at that time for certain reasons, as I indicated.
The other matter is quite different. In concluding my remarks on it I might answer what has been said and what was said previously by just reading what has been decided on the other side of the line. My friends have

Agricultural Products Board been saying that we ought to do the same. Here is what they decided and announced on November 30, very recently:
Promising as much help as possible, the department said it would be prepared to support producer prices of corn, cotton, wheat, rice, soybeans, wool, milk and butterfat at maximum levels permitted by law. That level is 90 per cent of parity.
However, no supports were promised for hogs, beef cattle, poultry, eggs and other perishable products. None of these products is being supported this year.
I just read that in order to give the latest information that is available on it in order to indicate that the policy which is being advocated by some was followed in the United States, and they have come to the conclusion that they cannot carry on with that policy with perishable products any further. The products we are discussing here this afternoon are largely in that class. If I may say so, our policy has worked out better than the policy followed in the United States.


Percy Ellis Wright: In answer to that I would just say that in Canada we have not one agricultural product at the present time supported by a parity price. At least they have a few in the United States, the major products. The minister still has not answered my question as to whether the representatives of the egg producers asked for anything more than the 38 cents guaranteed to the packers or others who had eggs to deliver at the end of the year.


James Garfield Gardiner: Some asked for 42 cents the year we first set it at 38 cents, and we set it at 38 cents. They all came back at the end of the year and said it had worked satisfactorily, and asked us to re-establish it just as it was. A few people have been writing in this year and saying that it should be 42 cents, and actually a few had it up to 43 cents. But in so far as the general producers and handlers of eggs are concerned, no general representation has been made that it should be changed, and we are leaving it as it is.


Mr. Fair:: After listening to the discussion during the last ten or fifteen minutes I should like to ask the minister whether I am correct in assuming that at the present time there is no producer floor price for eggs?


James Garfield Gardiner: There is a system which is being followed in handling eggs which has resulted in the farmer having the highest price for his eggs in the last eleven months that he ever obtained in any eleven months of any year.


Robert Fair: That is all gone by. What of the future?


James Garfield Gardiner: It is not a matter of how it is done: it is a matter of what results from what is done.


Robert Fair: There is no guaranteed floor price for the producer for the remainder of the present year? That would be correct, would it not? There is no reply.


James Garfield Gardiner: It would not be correct.


Stanley Howard Knowles: Does this section of the bill or any other section give the agricultural products board power to be the exclusive importer of butter from abroad?


James Garfield Gardiner: The government has authority under other measures to take that action, and the government has taken it.


Stanley Howard Knowles: 
James Garfield Gardiner: The position in relation to these matters is exactly as I stated it at the beginning. In the first place, I stated to the house on the resolution that we are asking the house to put in the form of legislation the same authorities and powers as were taken

under the order in council which was passed under the special powers given to trade and commerce last year.


Stanley Howard Knowles: There has been a gap-


James Garfield Gardiner: Wait, and you will get an explanation of it. We certainly believed that we had the authority to pass it and we had the authority to operate under it. But we anticipated that if we came to this house and reported that by order in council we had done so and so, and it had to do with something we might desire to continue to do, the house itself would suggest that it ought to be put in the form of legislation passed by this house. Therefore it has been put in the form of legislation and brought here for the house to pass or turn down as it sees fit.
The present position is that the board is buying the butter. It could be purchased by some other authority under the terms of other legislation, but the government has decided that it should be purchased by this board so long as the board is there. Up until the time this legislation passes it is done under the order in council. If this house were to refuse to pass this bill then I suppose consideration would be given to doing away with it altogether. But as soon as it is passed the authority which is now exercised by the board under order in council will be exercised under legislation.


Stanley Howard Knowles: In other words the board expired when the previous statute lapsed on March 31, 1951. The board has not yet been reconstituted by an act of parliament. In the meantime I take it the board has enjoyed its existence by virtue of an order in council passed under the Emergency Powers Act.


James Garfield Gardiner: It was legislation passed by this house.


Stanley Howard Knowles: On whose recommendation was that order in council passed?


James Garfield Gardiner: I believe it was on a recommendation from my own department. Probably it was signed by me, though I am not sure whether I was here at the time. It was either signed by me or by the acting minister. It was submitted to council and agreed to, so it is the product of the mind of the whole council.


Stanley Howard Knowles: During this interval that the board has enjoyed its existence not directly on the basis of a statute but on the basis of an order in council, it appears to have been under the aegis of the Department of Trade and Commerce. Will it be there after this statute passes?


James Garfield Gardiner: As I remember the terms of the legislation, it gives authority to have
Agricultural Products Board certain things done in, I believe, any department of government, and under that legislation this particular thing was done in the Department of Agriculture.


Stanley Howard Knowles: I wonder if the minister is sure of that.


A. Earl Catherwood: The minister has said that the board would act on the recommendation of the government. I trust it will act on the recommendation of the advisory board, as well. Will the minister assure the committee that in connection with the importation of farm requirements the board will work in conjunction and co-operation with those who have been importing farm products, and who know the extent to which these products are required?


James Garfield Gardiner: I did not catch the last part of the question.


A. Earl Catherwood: Is the board to work in conjunction with those people who have been carrying on the importation of farm goods over the last number of years? Would this board work in conjunction with them in connection with importations of seed and other farm requirements? I understand the board would not in any way interfere with importations that have been in effect in the past?


James Garfield Gardiner: I am quite satisfied the board will not in general interfere with those who are importing products into this country. But where there is no other authority doing the job to the satisfaction of those who desire to have it done, the government can assign that the work be done by this board.


[Stage Direction]
Section agreed to.
Section 5 agreed to.
On section 6-Penalties.
John Alpheus Charlton: This is the penalty section, and I should like to read it:
6. (1) Every person who violates an order of the board made pursuant to paragraph (d) of subsection one of section four is guilty of an offence and is liable on summary conviction to a fine not exceeding five hundred dollars or to imprisonment for a term not exceeding six months or to both fine and imprisonment.
(2) In any prosecution under subsection one evidence of an order of the board may be given by the production of a copy thereof purporting to be certified to be a copy by the chairman, vice-chairman, secretary or other official of the board.
My contention is that a fine of $500 or imprisonment for six months, or both fine and imprisonment, is too heavy for the ordinary producer. It may not be heavy enough, however, for some processor. Although the expression is "not exceeding $500" it is possible for a producer to be fined
2090	HOUSE OF
Combines Investigation Act that much. For instance a producer may be holding a few hundred dozen eggs, a few tons of honey, or a small quantity of various other products, whereas a processor may be holding thousands of dozens of eggs or thousands of tons of honey. Therefore I move in amendment, seconded by the hon. member for Middlesex East (Mr. White):
That section 6 be amended as follows:
(1)	that all the words after the word "conviction" in subsection (1) to the end of the subsection be deleted, and the following substituted therefor:
(a)	in the case of a producer, to a fine not exceeding $300 or to imprisonment for a term not exceeding three months, or to both fine and imprisonment.
(b)	in any other case, to a fine not exceeding $1,000 or to imprisonment for a term not exceeding six months, or to both fine and imprisonment;
(2)	that the following be added as subsection (2) :
"If a corporation is guilty of an offence under this act, any officer, director or agent of the corporation who directed, authorized, assented to, acquiesced in or participated in the commission of the offence is a party to and guilty of the offence."
(3)	That subsection (2) of the said section be renumbered subsection 3.
That is taken in practically the exact words from the Canadian Wheat Board Act, Therefore I suggest there is nothing in the wording that would be objectionable to the Department of Justice. I have a copy of the Canadian Wheat Board Act, if the Minister of Justice would like to check it. I would be happy to let him have it, so long as it is returned to me.


Stanley Howard Knowles: I take it that the reference is to the word "conviction" as it appears in line 34. Perhaps the amendment should be so worded.


John Alpheus Charlton: Yes.


James Garfield Gardiner: Mr. Chairman, we are prepared to accept the amendment as suggested. Amendment agreed to.
Section as amended agreed to.
Bill reported, read the third time and passed.



COMBINES INVESTIGATION ACT


Stuart Sinclair Garson: the second reading of Bill No. 36, to amend the Combines Investigation Act.


Mr. Speaker:: Is it the pleasure of the house to adopt the motion?


Some hon. Members:: Carried.


Gordon Graydon: Just a moment, Mr. Speaker; just a moment.
[Mr. Charlton.l


Stuart Sinclair Garson: Mr. Speaker, I never like to disappoint the hon. member for Peel (Mr. Graydon), so if he will take the responsibility for what I am now going to inflict upon hon. members I shall be glad to make a statement in this matter. In view of the importance of the bill now under consideration I think in fairness to those who will take part in the debate later I should begin by tracing briefly the different steps which have led up to this matter which is now before us at this stage.
In June of 1950 a committee, which has come to be known as the MacQuarrie committee, was appointed to study the whole field of combines legislation and to recommend what amendments, if any, it thought should be made in order to make the combines act a more effective instrument for the encouragement and safeguarding of our free economy. Hon. members can see from the terms of reference that the committee's authority was as broad as it possibly could be. The committee in beginning its work by soliciting representations from various trades which were concerned and from individuals, drew attention to what had been said about the subject of resale price maintenance by the royal commission on prices in 1949, and it invited from organizations and individuals, in the light of the findings of that royal commission in 1949, their views upon this subject. Far from this bill having been thrown together very hastily and in an ill-considered manner at the last minute, as some of its opponents have suggested in committee, it deals with a subject matter which was considered carefully by the royal commission on prices in 1949 and referred to in its report, which report was then fully considered by the MacQuarrie committee, which in its proceedings in 1950 and 1951, expressly requested information and representations from the various trades concerning resale price maintenance.
This subject matter emerged in the speech from the throne as an item of government policy after we had asked the MacQuarrie committee in the late summer of 1951, when its general report had been held up by the magnitude of its task and some delays in receiving representations, whether it could give us a special interim report upon the subject of resale price maintenance which would be interim only in the sense that it was delivered before its final report, but which would be final so far as the subject of resale price maintenance was concerned.
The MacQuarrie committee replied in the affirmative, and made its report available in early October. The report of the committee,

which has come to be known as the Mac-Quarrie report, recommended against the practice of resale price maintenance, and in particular, recommended that it should be an offence for a manufacturer, first, to recommend or prescribe minimum resale prices for his products and, second, to refuse to sell, to withdraw a franchise or to take any form of action as a means of enforcing minimum resale prices.
The committee did not recommend that it be made an offence to prescribe resale prices which are not specific or minimum prices, from which it follows that suppliers would be free to fix and to enforce maximum prices. Nor did the committee recommend against the right of a manufacturer to indicate a resale price as long as such price was not recommended or prescribed as a minimum. In addition, the MacQuarrie committee went on to make some observations on the subject of loss-leader selling, a subject with which I shall deal later.
Perhaps at this point I should define resale price maintenance. It is most important in dealing with this whole subject that we should have a clear understanding as to just what type of resale price maintenance we are dealing with in the context of this bill. There are two kinds of resale price maintenance. First, rival suppliers, whether manufacturers or distributors, may agree among themselves to maintain prices of comparable articles at agreed levels at various stages of distribution. This is commonly referred to as horizontal resale price maintenance and, generally speaking, it is already an offence under the Combines Investigation Act. That is to say, it takes place largely horizontally, as it were, among all the dealers in a certain trade.
The second kind takes , place when a single manufacturer prescribes the prices at which his goods are to be sold or resold at the various stages of distribution. That is, he steps down out of his own level to suggest to those at either a lower or higher level, depending on one's viewpoint, the basis at which they can sell or resell his goods. Therefore this type of resale price maintenance is commonly referred to as vertical resale price maintenance, as distinguished from the horizontal type to which I referred a moment ago.
This vertical resale price maintenance may or may not be forbidden by the present terms of the Combines Investigation Act, depending upon the particular circumstances of the case which comes before the courts. In most cases, however, it will not be illegal under the act as it now stands. It is this latter type
Combines Investigation Act of vertical resale price maintenance which the MacQuarrie committee studied and reported against, and with which the bill now before us is concerned.
The interim report of the MacQuarrie committee on resale price maintenance was made, as I have said, early in the month of October. The speech from the throne delivered on October 9 contained the following paragraph:
The government has received an interim report from the committee studying the combines legislation recommending that suppliers of goods should be prohibited from requiring or inducing distributors to resell such goods at fixed or maximum resale prices. You will be asked to consider legislation arising out of the committee's interim report.
The speech by the Prime Minister (Mr. St. Laurent) on the address in reply to the speech from the throne and the radio broadcast I made over a coast to coast hook-up also made it clear that we accepted this report and were prepared to act upon it. I maintain, in the face of some of the contentions which have been made to the contrary, that the position of the government has been crystal clear at all stages of this matter. We accepted the MacQuarrie report and proposed to act upon it at this session.
It is quite true, of course, that following these announcements representations were received from a large number of trade associations as well as from individual manufacturers and merchants all across Canada, large and small, to the effect that in their opinion the prohibition of resale price maintenance would very seriously affect their businesses. They felt that it would be most unfair to proceed with this prohibition of resale price maintenance until they had an opportunity to be heard before the bar of public opinion.
We decided to accede to their requests. On November 6, as hon. members will recall, I introduced a resolution for the establishment of a joint committee of the Senate and House of Commons, and I quote:
-to consider the interim report of the committee appointed to study combines legislation tabled in the House of Commons, Friday, October 12, 1951, and to consider appropriate amendments to the Combines Investigation Act based thereon.
The joint committee was duly constituted; it commenced its sittings on Tuesday, November 13, and concluded them on Friday, December 7. During the course of the committee's sittings there had been placed before it by the combines commissioner a draft amendment to the Combines Investigation Act which translated into legislative form the recommendations of the MacQuarrie committee. The joint committee in its report which was tabled in this house on Friday, December 7, recommended legislation along

Combines Investigation Act the lines of this draft and went on to make some comments on the question of loss-leader selling to which, as I have already said, I shall refer later.
This completes this short review of what has led up to the introduction of the bill now before hon. members. It indicates that this matter has been under periodic consideration ever since 1949.
I should like next to deal with the substance of the bill before us and to indicate what in my opinion are the principles involved. First of all, however, I should like to refer to the principles upon which the MacQuarrie committee based its conclusions that resale price maintenance should be forbidden. These were as follows:
1.	That the direct and immediate effect of resale price maintenance is the elimination of price competition among retailers in price-maintained goods, this being one of the main objectives of the practice.
2.	That resale price maintenance facilitates and makes more effective the formation of combines among manufacturers.
3.	That the practice of resale price maintenance establishes a private system of law under which the business of a non-conforming retailer or of a retailer who is merely believed to be non-conforming may be seriously prejudiced without that retailer having any recourse to the courts of justice.
4.	That the tendency of the practice is to maintain prices at a higher level than would be the case under competitive conditions.
5.	That to the extent resale price maintenance stabilizes prices it contributes to the instability of production and the reduction of sales, results which serve neither the interests of manufacturers nor th 2 general welfare.
The MacQuarrie committee also dealt with certain arguments in favour of resale price maintenance. As to the fact that resale price maintenance prevents a retailer from taking advantage of his geographical position or of a temporary scarcity of the article in question to charge excessive prices, the MacQuarrie committee pointed out that the authority to fix and enforce maximum prices which this new legislation will permit would be adequate to prevent this. In other words, if merchant men up in, say, the Peace river area wanted to charge more than this maximum price for a certain article of merchandise and the manufacturer of that article were desirous that he should not do so the manufacturer would have power under the legislation to prevent it.
TMr. Garson.]

As to the argument that resale price maintenance prevents loss leaders, the MacQuarrie committee stated that more direct and desirable weapons could be found to curb loss leaders, which they did not believe to be an immediate problem at the present time.
As to the contention that resale price maintenance encourages the operation of more retail outlets and the view that it affords a measure of protection to the small retailer, the committee pointed out that this protection was likely to be illusory because
(a)	the high margins fixed by resale price maintenance can be used by large stores to expose the small retailer to a more acute form of competition in the field where prices are not maintained. In other words, they can take the profits they make on the maintained prices and use them to cut the prices of goods which are not maintained.
(b)	High margins, below which the retailer cannot go, merely transfer competition-and even the supporters of resale price maintenance argue this as part of their case- from the field of prices into the field of services and as a result wasteful forms of competition in services are thereby created, increasing the costs of the retailer to some appreciable part of the amount that he might conceivably have saved by having his prices maintained.
(c)	Fixed margins provide an inducement to newcomers to enter into the retail field so that too great a number of outlets with consequent reduction in individual volume may result. This has been the experience, for example, in the drug trade in Great Britain, where under the umbrella of resale price maintenance there have been increases of the order of 8,000 or 9,000 newcomers into the trade each year to take advantage of what seemed to be a superficially favourable situation created by this practice.
The MacQuarrie committee believed that there would always be a place for small dealers in retailing but considered that resale price maintenance contributed more to discourage individual efficiency than to protect the small business. That is to say, if it did in any respect protect small business-and I will argue later that it does not-any merit it might possess in that resipect was much more than offset by its discouragement to individual efficiency.
In reply to the argument that resale price maintenance was necessary to protect the reputation of branded goods-we were told that it was not fair to the manufacturer who has spent hundreds of thousands of dollars to build up prestige for his brands to have them made subject to any kind of price

cutting-the committee expressed itself as not convinced that the reputation of branded goods suffered greatly from normal price variation.
During the last month or so, and particularly after the committee sat on this matter, we have heard inside this house and out of it, before the committee and outside of it, many of these arguments I have mentioned and others besides. I must say that some of them seem to me to range pretty far afield, and not all seem to be completely relevant or entirely helpful to a consideration of this subject. But having regard to the fact that, since we decided to accede to the request of those concerned to send the bill to a committee, the only way in- which the bill could be got out of the committee in order to be passed -at this session of the house was by our not hearing those who were in favour of the bill but only those who were opposed to it-


Mr. Fleming:: And only some of them.


Stuart Sinclair Garson: And all of them that were
not repetitive. The steering committee analysed the briefs presented, and the committee heard from all opponents of the bill all arguments which were not mere repetition. In view of that fact this issue comes before the house today in the position that -a very great deal has been said over quite a long period of time against the legislation. Many such arguments have been- developed, and this is really the first opportunity we have had to develop any arguments in favour of the legislation. That being the case, I should like today to deal with the arguments which have been raised against it. I will try to take them up one by one and show, if I can, that they are fallacious.
This of course is not' a simple subject, and it would be a great mistake to deal with it as such. I think we must all concede that there -are many aspects which require particular consideration-.
Nevertheless it seems to me that the crux of the matter can be stated with some clarity and brevity. The Canadian way of life has always proceeded upon the majority view-I know there are some of our friends in the house who m-ay not agree with this-that free enterprise s-purred by competition is the system that will produce the most abundant returns for the greatest number of people. There are, even under a system of free enterprise, it is true, such things as public utilities where free enterprise has had to be replaced to some extent by government control. Each one of these exceptions depends upon its own peculiar circumstances, but in general the economy of Canada is free and it is, thank goodness,
Combines Investigation Act competitive. The question involved in resale price maintenance therefore is whether this principle of competition which is the very essence of our free economy is to be replaced by a practice under which the manufacturers and the distributors alone determine price without effective intervention of consumers or the government. That is the issue involved in this matter.
In this connection, the first point I should like to make is that in the determination of resale prices the profit mark-ups taken by the wholesaler and the retailer are quite important. Sometimes, I am afraid, we are inclined to regard the consumer price of a given commodity as the cost of manufacturing it plus a comparatively small mark-up to get it from the manufacturer to the consumer; in other words, we are inclined to think that the bigger part of the job is in getting it created, and that getting it merely from the manufacturer to the consumer is the lesser part of the job. This thought is deceptive; it is not true, because in many cases these wholesale and retail mark-ups together equal or exceed the manufacturing cost. That is one thing that the statistics-and, I may say, the inadequate and sketchy statistics-which were submitted to the joint committee proved.
As I said a moment ago, we are all agreed that competition is vitally important in our free economy. I think we are all equally agreed that both primary and secondary producers turn out goods at a lower cost to consumers, and thereby raise the standard of living, by competing with one another. Our contention is that competition is no less important in the distributing field than it is in the field of production. I submit that no convincing reason has been brought forth, in all this mass of material that was presented to the committee by the opponents of this bill, to show that the process of distribution can be discharged efficiently and economically without competition; and for these purposes the only really effective competition is price competition. For not only does price competition provide a high standard of living by guaranteeing an efficient production and distribution at a low cost to the consumer; it is also my submission that it guarantees what the supporters of resale price maintenance say resale price maintenance guarantees but what we say resale price maintenance does not guarantee, namely the genuine independence of the retailer, particularly the small retailer.
I propose to submit to you, sir, that competition does protect the genuine independence of the small retailer, and that resale price maintenance does not protect his independence; for under competition it is selfevident to anyone who has the slightest

Combines Investigation Act to his wholesaler and saying "My retail competitor is selling a shirt of the same quality as yours for 50 cents less. Unless you can give me a better price I cannot sell your shirt in competition with him, so you will have to sharpen your pencil and give me a better price on it." But when the retailers are not competitive-when the retail price is fixed- their direct interest in getting manufacturers' prices down disappears, because the higher the manufacturers' prices go the higher the price their mark-up will apply to. Indeed it is more serious than that, because instead of the retail trade bringing pressure upon the manufacturer to reduce his price the manufacturer seeks to secure the goodwill of the retailer by providing him with bigger and better margins than other manufacturers will provide him, and the consumer foots the bill.
You might think perhaps this is rather a strong argument for me to develop, but let me give you a few examples.


Mr. Hees:: Don't worry about us.


Stuart Sinclair Garson: Well, strongly worded, shall I say, as a concession to my hon. friend. Let me give you a few examples of what I mean.
I am not going to give the names because I do not wish to be unfair, but if any hon. member is curious about these matters I can show him privately a photostatic copy of these advertisements which I have here on my file.
I will show them to him privately. These are all recently published full-page advertisements from a reputable trade journal. The first concerns a cough syrup.


George Alexander Drew: That is not made in Brockville,
I hope.


Stuart Sinclair Garson: I do not think it is, as a matter of fact. I do not think it is made in Carleton, anyway. The first concerns a cough syrup that, I venture to say, many hon. members have used. It is quite a well-known product. The advertisement reads in part:
Longer-profit deals-up to 42-8 per cent profit! Don't be caught short! Blank-
That is the name of the so and so firm.
-blank is offering the widest profit spread on the fastest-growing cough syrup in Canada . . . hurry! Time is short-profits are long!
The second advertisement is that of a type of throat lozenge which doctors in the city, to my knowledge, are recommending to their patients at the present time, and I have not the least doubt with every justification. Here the profit is somewhat lower, 40 per cent, but please note the approach:
When the doctor says "get blank's," the patient gets 'em. Price is no object. And you profit accordingly.
And a third is even more revealing. It concerns a popular medicated plaster, and


the advertisement is run by a highly reputable and leading manufacturer in this country. This special offer "Boosts your average profit-per-backache to a whopping 48-1 per cent." I should interpose here, Mr. Speaker-


Donald Methuen Fleming: What was the date of that advertisement?


Stuart Sinclair Garson: These are within the past six months.


Stanley Howard Knowles: What was the date of the backache?


Stuart Sinclair Garson: No, the date of the advertisement. If my hon. friend is interested at all I can show him the photostatic copy.


George Alexander Drew: He wants to find out how much he has lost.


Stuart Sinclair Garson: 
Edmund Davie Fulton: Some of them were.


Stuart Sinclair Garson: No, I think not, by any means. They would reply that the retail price of this particular type of product over the last ten years, in spite of all the rise in the cost of living, the rise in the price of eggs and in the price of beefsteak and so on, had not risen at

all. That was one of the statistical red herrings which certain persons sought to draw across the path of the committee. But I submit that if this contention were true-and it may be true; I am not suggesting that it is not-it would still be irrelevant because I suggest it could only be true because of economies effected by increased efficiency of production, which the public would have shared in any event, and I think more fully, without resale price maintenance; or perhaps because the original prices were so high ten years ago that all the increases in labour and material costs involved in them could be easily absorbed, still leaving a quite adequate profit.
Let me take three typical cases from the electrical appliance field. These are taken from the material submitted by the trade to the joint committee, and I have taken the first specific instances given in their material, that of an electric range, an electric washer and an electric refrigerator respectively. The information on the range shows that the cost to the wholesaler, in 1950, including all taxes, was $204.15. The retailer's cost was $230. He sold the product to the consumer for $349. This means that the retailer's mark-up was 52 per cent over his cost, or $119 on an article that he had bought for $230. The wholesaler's mark-up and the retailer's mark-up together amounted to 71 per cent of the manufacturer's selling price, which included the manufacturer's costs, his profit, taxes and freight.
In the case of the washing machine which retailed for $159.50 in 1950 and the refrigerator which retailed for $375 the figures tell substantially the same story.
Some people may regard these mark-ups as excessive, notwithstanding the explanations to which I think it is only fair that I should refer, that in carrying these articles in stock it was necessary to service them and to keep them in shape so they would be in good order when they were sold, and to take care of the claims that were made by the purchaser during the guarantee period, and the like. I express no opinion myself as to the adequacy or otherwise of the prices. I cite them for another reason altogether. I submit that the druggist who sold the medicated plaster made on his cost of 52 cents a mark-up of 48 cents. The retailer who sold the range made $119. What I say is this: I think it is a very reasonable assertion to say that these margins, under resale price maintenance, are set by the manufacturer who, in the nature of things, cannot have a direct knowledge of the individual retailer's cost of doing business.
Then, to put the next point in the form of a question: Would any reasonable person
Combines Investigation Act maintain that margins like these do not leave room for a retailer to pass back to his customer the savings he can make by the efficiency with which he runs his store, as compared with the efficiency with which his competitor runs his store? That may not be a very great amount, nothing like the margin provided here. But is there anything in the size of the margin to indicate that it does not leave room for the retailer to pass on to his customer any efficiency he has developed in the running of his own business? Yet under resale price maintenance he cannot pass back one penny. He cannot compete in price. The only way he can compete and try to get business from the other fellow is by keeping the whole of the margin and spending the money he thinks he should spend to outdo the other man in sales promotion, fancy store fronts and the like, which I am sure most buyers of goods would regard as a very poor substitute for a competitive cut in prices.
How difficult it is for the manufacturer to fix the retail mark-up is shown by the variation in distributors' costs, which do vary considerably from one merchant to another, just as manufacturing costs vary from one factory to another. The dominion bureau of statistics has published a recent report which shows the operating expenses of certain businesses. The table to which I am now referring and which, if I may have permission, I should like to place on Hansard in full -I shall quote only a small portion of it-


Donald Methuen Fleming: What is the source?


Stuart Sinclair Garson: The dominion bureau of statistics. The table I shall place on Hansard shows the average and then the middle range of distributors' costs. That is to say, if one considered that there were four levels of distributors' costs, in arriving at this middle range he would eliminate the two outside ones. Then the middle range represents the high and the low of the inside ones. All the extremes are eliminated.
It shows the middle range for groceries running from 5-6 to 8-4. These figures are shown as a percentage of net sales. In another range, of tobacco and confectionery, it is 4-2 to 7-6. Then we come up to automotive parts and accessories, which varies from 16-5 to 28-0. This comparison, it will be remembered, is just in the middle range. In connection with hardware the figures are from 11-8 to 19-0. I suggest that these variations show how impossible it is for a manufacturer, under resale price maintenance, to select any common margin or mark-up as the fixed spread which should prevail in the sale of
2098	HOUSE OF
Combines Investigation Act one of his items in the hands of all the retailers to whom he supplies it.
The illustrations I have given do not cover the whole story, but I believe they are sufficient to make my point.


Mr. Speaker:: Order. Do I understand the minister has permission to place the table on Hansard?


Some hon. Members:: Agreed.


Donald Methuen Fleming: What was the date of the return of the bureau of statistics?


Stuart Sinclair Garson: It was 1949.


Donald Methuen Fleming: Is there anything more recent than that?


Stuart Sinclair Garson: I do not think so. As my hon. friend knows, there is a time lag in the gathering of these statistics. Those I have are the latest available. It will be understood that I did not gather these figures myself, but I am sure my staff would have gathered the latest available. I believe these are the latest available. Then, as I have been given permission to place the table on Hansard, may I say it is as follows: I
Per cent of net sales Average Middle Range
Grocery 	7-1	5-6- 8-4Fruit and vegetable 	9-5	7-7-12-5Tobacco and confectionery.	5-6	4-2- 7-6Dry goods 	13-4	10-1-16-7Piece goods 	12-6	9-6-17-3Automotive parts and accessories 	200	16-5-28-0Hardware 	14-1	11 [DOT] 8-19 *0Plumbing and heating supplies 	120	9-4-14-7
I should like to supplement these points by one further detail. In addition to these middle range variations in the cost of distributing goods, we found upon inquiry that in representative lines of electrical appliances the retailer's margin varied quite substantially with the volume of business he did. To take an example: In the case of a certain refrigerator, the retailer's selling price being fixed under resale price maintenance but his buying price being dependent upon volume, his mark-up on cost varied by as much as 16 per cent, depending upon the quantity he got from the manufacturer.
Now, as I said earlier, ordinarily increased volume means reduced prices by virtue of the fact that many of the articles we are buying today at a modest price are available at that price because they are produced in volume. The more volume there is, the lower the price becomes. But in this particular case the man who buys in volume like this gets that 16 per cent, but under resale price maintenance he cannot pass any of it back to his customer except by way of extra service of one kind or another.

To give an example of such services there is the running of charge accounts at no extra cost to the person opening the account, if he wishes to pay in that way. Ordinarily when a man buys for cash he saves the merchant a great deal by way of bookkeeping expense, time and trouble, and also there is a saving in bad debts.
One would ordinarily think that if he made a saving by that method of purchasing, which he had chosen, he should be able to get that saving. But under resale price maintenance he cannot get it. In effect, under resale price maintenance the manufacturer says, in relation to the pair of shoes about which I was speaking a moment ago-and I am afraid the price of $5.50 I mentioned is not up to date; perhaps I should have said $11-


Mr. Fraser:: That must have been 1935.


Stuart Sinclair Garson: Yes. I am a little behind in that respect. In effect the manufacturer says this: "I am sorry; this is a packaged commodity I am selling, and it consists of $5 for the shoes and 50 cents for sales promotion and fancy services. If on top of the price for the shoes you, having only $5 in your pocket, cannot pay for this service, then you cannot have either the shoes or the service; for under resale price maintenance I cannot reduce my price below $5.50. In this way you must go without shoes and I must go without the sale." That is exactly what it means. There is no way of price reducing under resale price maintenance.
I next submit that vertical resale price maintenance may promote or assist the operation of a horizontal, price-fixing combine. Resale price maintenance may be developed in two different ways. It may be used by a single manufacturer in the first instance, independently, because he thinks it will maintain the reputation of his product and give him the best possible return upon it. But, sir, let us suppose that each one of a number of manufacturers of comparable products in a certain line of business is able to tie up all his retail and wholesale outlets by a perfectly legal resale price maintenance understanding, which fixes the prices they are to charge at the wholesale level and at the retail level. He has already fixed the price at which they are to be charged at the manufacturing level. I suggest that once each of a number of manufacturers has thus tied up his outlets in a lawful manner then all those manufacturers are in a much more favourable position to conclude among themselves a horizontal price fixing agreement which is illegal under the Combines Investigation Act. Moreover, behind the lawful facade of resale

price maintenance such horizontal price agreements will be very hard to detect and prosecute.
My next submission is that price maintenance may provide an effective substitute for combines. If a group of distributors, we will say in the X trade, agree among themselves and with the manufacturers to maintain prices on the goods in that trade, that would be a combine unlawful under the Combines Investigation Act. But suppose that, instead of agreeing among themselves to fix prices, they go separately to all the manufacturers who produce for that trade and persuade them to introduce resale price maintenance on their products, then I suggest that virtually the same results will be achieved and within the law as it now stands, but with all the harmful effects so far as stifling competition is concerned as would be present in a combine itself.
Evidence submitted to the joint parliamentary committee was rather illuminating on this subject. The evidence submitted indicated that the movement toward resale price maintenance came as often from the retail trade as from manufacturers, and its purpose was to achieve by indirect means that which if achieved by horizontal price fixing agreement would have constituted an indictable offence under the Criminal Code and the Combines Investigation Act.
There was a tendency on the part of some witnesses before the joint parliamentary committee to minimize the extent of resale price maintenance in the distributive trades as a whole. As I understood it, the argument was: "Well, after all, it is only a small segment of the entire picture that is affected by this practice, so why bother? Why not wait until it becomes a much more serious abuse than it is at the present time before taking cognizance of it?"
It seems obvious that if the practice affected such a small part of the retail trade as these advocates alleged then such strong efforts to maintain the practice would not have been made before the committee by so many and varied trades. I am sure members of this house would not have received nearly the amount of correspondence and the number of telegrams they have received during the last few weeks if the allegations of those gentlemen had been correct.
I am not going to take up the time of the house with any detailed statistical analysis of the practice. We have done an accurate job, but to outline this in detail would take up a great deal of time which I think could be spent to better purpose. In any event I think we can rely upon the general conclusion of the various inquiries into this subject that
Combines Investigation Act retail price maintenance is now applied widely to a great many lines of commodities and that the practice is increasing. For example, the royal commission on prices in 1949 stated in its report:
Throughout our inquiry we have been impressed by the degree to which individual manufacturers fix the resale prices of their products and so narrow the area in which price competition amongst wholesalers and retailers is operative.	[DOT]
Having read the MacQuarrie report, I am sure hon. members are aware that it referred to the widespread practice of fixing resale prices, and to the growing proportions of the practice. I might supplement this by one or two references to the evidence given before the joint committee. The first trade group to appear were the manufacturers and distributors of that important commodity, beauty supplies. While perhaps not typical of trades generally, its representative estimated that resale price maintenance in his field had increased from about half in 1940 to approximately 90 per cent now. The Canadian association of radio and appliance dealers stated that price maintenance applied to 80 to 90 per cent of the industry. Mention was made before the joint committee of an estimate that over 60 per cent of the volume of trade of a druggist is in price-maintained lines. On the other hand only a very small proportion of the total volume in such lines as groceries and hardware are price maintained. But even in those fields there was evidence that greater emphasis was being placed upon branding and efforts are being made to extend resale price maintenance. I think the most significant statement was that made in the brief of the Canadian Federation of Agriculture to the effect that more than half of all the purchases made by farmers for productive purposes came directly under some form of private resale price fixing, which in itself it seems to me is a pretty serious situation.
The practice therefore certainly does not play an insignificant role in trade in this country, and there is nothing in any evidence that has come before us to suggest that the practice has by any means reached the limits to which it might very easily go if left unchecked. The fact that resale price maintenance has not yet extended over a predominant portion of trade as a whole is not, in my view and in my submission, a reason for refraining from dealing with it. Being convinced as to the undesirability of the practice and the fact that it is growing, it seems clearly preferable to prohibit it in its present stage when any consequent dislocation will be of small order, rather than to deal with it, as the British are now doing, when it has become as widespread as it has in that country.

Combines Investigation Act
I should like to deal now tor a moment with the argument which recurred again and again in the proceedings of the joint parliamentary committee. We heard from witnesses and from several members of the official opposition that we should keep this committee in existence and superimpose, like Ossa upon Pelion, this inquiry upon that of the MacQuarrie committee which, in turn, was on top of the royal commission on prices of 1949. The argument was that it was all very well to have these professors and other academic individuals give their opinion, but what we needed were some good sound statistics showing, among other things, that the best comparison to make was the simple comparison of the retail margin on price-maintained articles with that on non-price-maintained articles. It was contended that if we could just get enough of that and take time enough we would get at the root of this problem.
I suggest that such a study would be largely meaningless. The retailer's margin is only one of a series of costs involved in moving goods from the factory to the consumer. Differences in these margins will depend upon a variety of factors such as trade custom, the extent of selling and advertising assistance, the age and reputation of the brands under consideration, the relative amount of consumer recognition and preference, and the volume of turnover. To give a proper weight to each of these factors before arriving at what could be realistically regarded as comparable marketing margins would be a hopelessly difficult task, and anyone who suggests otherwise has not scratched the surface of a consideration of this subject. It is a task, may I also say, that has been wisely avoided by serious and competent authorities upon resale price maintenance, who- affirm that the only meaningful analysis of the effect of resale price maintenance on the price of an article would be to compare the price of the article under resale price maintenance with the price of the same article under similar conditions of sale when the price was determined by freely competitive forces. In other words, compare things that in all other respects are identical under conditions that are identical but which differ only in that in the one case they are exposed for sale under resale price maintenance and in the other case under free competition.
The difficulty of course in this country is that such comparative conditions are rarely met with; for the practice of resale price maintenance where it exists is so universal as to leave no islands where free competition can make itself felt on the prices of products


which in other parts of Canada are price maintained. Indeed we all face a difficulty- and I -think the MacQuarrie committee, the joint committee and the government have faced it-in that there is in Canada a relative dearth of comparable material of this and other sorts. It was very significant that in my view much the best brief presented to the joint -committee was that of Professor Fuller upon behalf of the pharmaceutical association of Canada, a very honest and competent job, if I may presume to say so, in spite of the fact that I do not agree with many of its conclusions. But Professor Fuller was under the necessity of admitting under cross-examination that no single fact or figure in his long brief was from Canadian sources. He was critical that the MacQuarrie committee and the government had not examined to a greater degree figures available in the United States which formed almost the entire foundation for all his reasoning, and he was critical that we had not examined figures -available in Great Britain. That was a pure assumption on his part. There was no evidence -at all that the MacQuarrie committee either did or did not examine these other figures, but in so far as any observations he might have made referred to the combines investigation department I should like to place upon record that we have examined the figures in the United States and we have examined figures -and material in Great Britain. I will be referring to some of those figures before I complete my remarks.


Donald Methuen Fleming: Will the minister permit a question? When he says "we" to whom does he refer?


Stuart Sinclair Garson: I mean the combines investigation branch of the Department of Justice. To support my point I can cite what the proponents and the opponents of our legislation before the committee praised as a very competent report. The British Lloyd Jacob committee investigating this problem in 1949 concluded -that it was futile to attempt to compare margins on price-maintained lines with those on free price lines. Their report emphasized that much smaller sales effort was required from the retailer to sell the branded price-maintained product than to sell the non-branded free price product. At page 14 of their report -they said, "There is therefore no comparison between the two classes of trade." Yet some hon. members opposite were anxious that we should sit at least until next' spring and perhaps until next fall to gather all this evidence that in the opinion of the British Lloyd Jacob committee was largely meaningless.

More fundamental by far in our view are the long-run effects of resale price maintenance in discouraging efficiency in distribution and in imposing rigid price policies upon the economy. These are factors, the discouragement of efficiency in distribution and the imposition of a rigid price policy, which defy statistical analysis but nevertheless constitute the heart of the problem of resale price maintenance. Yet Mr. Speaker, there is scattered throughout the literature on resale price maintenance some statistical data, which Professor Fuller said the MacQuarrie committee could have secured, and which he set out in his brief. I am not quoting from his brief, but these are the same figures he used on the relationship of maintained prices and non-maintained prices on identical commodities that will be of interest in any event to evaluate the significance of resale price maintenance. Fortune magazine of January, 1949, undertook a summary of the prices of 117 drug products in Washington, D.C., a free trade area; that is, non-price maintained, and in nearby Maryland-if I remember correctly, Baltimore was the city chosen-where resale price maintenance is legal. This study showed that 35 of the 117 cost about one-third less in Washington than in Maryland, 38 about a quarter less and 29 about a seventh less. The same article carried a report of a comparison between prices in free trade Missouri and fair trade Illinois which showed much the same result. Fifty-four fair trade drug items cost an average of 16.2 per cent more under fair trade on the east bank of the Mississippi than under free trade on the St. Louis side.
The report of 1945 of the United States federal trade commission on resale price maintenance concluded that with reference to the grocery trade, where resale price maintenance is not widely practised, the impact of resale price maintenance, following the passage of fair trade laws, upon the general level of grocery prices was small, but that "price increases fell most heavily upon those consumers who from necessity or personal choice patronize minimum service stores." In other words, people who from necessity had to patronize minimum service stores were those who bore the heaviest brunt of the introduction of resale price maintenance. Similarly, in the drug trade the United States federal trade commission found that the burden of price increases fell most heavily upon the patrons of stores selling at lowest prices. Those consumers who were willing to accept less service and to shop in less attractive surroundings in order to achieve some economies in their purchases were, under resale price maintenance, precluded from doing so.
Combines Investigation Act
This finding of the United States federal trade commission is echoed in the conclusion of the Canadian royal commission on prices of 1949 in which it was stated that, among other undesirable effects, resale price maintenance:
. . . deprives the consumer of his right to seek and patronize the most efficient distributors, namely, those who over a period of time can offer goods for sale at prices lower than their competitors.
Finally we have in the case of the entry of Newfoundland into confederation some of the best evidence, a classical example in fact, of the harmful effect on prices of the introduction of the practice of resale price maintenance. Before it entered confederation there was no resale price maintenance in that land. After Newfoundland became a part of Canada, Canadian price maintenance was made applicable there. I am glad indeed that the hon. member for Burin-Burgeo (Mr. Carter), who was one of the government members on the parliamentary committee, intends to speak on this aspect of the matter; I shall therefore refrain from going into detail on it.
These data I have listed establish, I submit, two generalizations which hold true, broadly if not universally, concerning the effects of this practice of resale price maintenance. First, prices are higher than they would be under conditions of free competition; and, second, the poorer or economy-minded purchaser is deprived of the chance and indeed of the right of buying at lower prices in minimum service stores. This, indeed, Mr. Speaker, may seem to many hon. members like proving the obvious; for, as Mr. McGregor, the former commissioner under the Combines Investigation Act, stated in his evidence before the joint committee as reported at page 395 of the proceedings:
As the very purpose of resale price maintenance is to prevent sales below the minimum price established, it is obvious that the effect is to keep prices, right across the board, higher than they would otherwise be.
I should now like to deal with the position of the independent retailer in relation to resale price maintenance.


Some hon. Members:: It is 6.15.


Stuart Sinclair Garson: This is a fairly big subject upon which I am entering now, Mr. Speaker, so it might be convenient if you would call it 6.15.
At 6.15 p.m. the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock.
Stuart Sinclair Garson: Mr. Speaker, when the house took recess at six o'clock I was just about
2102	HOUSE OF
Combines Investigation Act to examine the position of the independent retailer in relation to resale price maintenance. This is a rather important aspect of the matter because no argument has been raised more frequently or stressed more strongly by supporters of resale price maintenance than that resale price maintenance is necessary to protect the independent merchants against loss-leader selling and other forms of competition. They go on to say that without such protection the small retailer would be driven out of business by the large retailer. Indeed the claim is made that resale price maintenance renders to the consumer an important service by enabling a number of small independents such as the convenient community drug store or the corner grocery store, or perhaps a general store in an inaccessible location in the country where the volume of business is not very great, to stay in business. In addition to that, it is argued-and no person, so far as [ know, ever contradicts this argument-that the independent retailer, wherever he is, is always an important element in the social, economic and cultural life of the community which he serves. They say that being such he is entitled to protection against the superior financial powers of the large departmental store, mail order house, chain store and the like.
Well, sir, these are all arguments which ire worthy of the most serious consideration, because I am sure every hon. member knows that this country would sustain a grievous loss if the independent retailer should disappear from our community life.
In this connection it seems to me that the critical questions are these: First, whether resale price maintenance does give the independent retailer the protection which is commonly claimed; second, whether without resale price maintenance the independent retailer will really be placed in a more difficult position, which I think is open to considerable question; and third and perhaps the most important, whether the broader implications of uniform price fixing do not possess inherent dangers for all concerned, including the independent retailer himself.
I suggest that there is no convincing evidence, but if I am wrong I hope that those who contend the contrary will produce it- that there is no convincing evidence that the position of the independent retailer has been substantially affected by the absence of resale price maintenance in the past, or that it will be substantially affected by the removal of resale price maintenance at the present time. The growth of large-scale enterprises, whether in the field of manufacturing or distribution, has been an aspect of economic development in most industrial
'Mr. Garson.l

countries during the present generation; and there is nothing to indicate that, in the case of the retail trade, the growth of big departmental stores, for example, or chain stores, has been different in those countries where resale price maintenance has been firmly established for a lengthy period from those in which the practice is less extensive. An eminent authority, to wit Professor M. T. Copeland of Harvard university, who for a considerable period directed the studies of the graduate school of business administration which were referred to, I presume with approval, in the pharmaceutical and hardware briefs, wrote in the encyclopedia of the social sciences in 1935 as follows:
Similar changes in retail trade have taken place in England despite the measures for control of resale prices adopted in that country, and in the United States the enactment of resale price maintenance legislation would not have given and will not give effective protection to small retailers against types of organizations which have inherent competitive advantages.
So that we are here discussing resale price maintenance as if it had provided a protection which in fact does not exist, and proof of which protection cannot be adduced. If one examines, for example, the available information on the structure of retail trade in Canada, the United States and Great Britain, he will find that, if anything, the independent retailer has the smallest share in Great Britain where resale price maintenance is most strongly entrenched. As compared with almost 73 per cent in Canada and about the same proportion in the United States, it is estimated that the independent retailers have less than two-thirds of the volume in Great Britain, the balance being divided between the chains, the departmental stores and the very powerful co-operative movement, which in part is the product of resale price maintenance.
The fact is that the independent retailer's share of Canadian retail business has been well maintained throughout the whole period from 1930 until 1949. These figures which I am about to submit are not the figment of anyone's imagination. These are the facts as to the position of the independent retailer in this country.
Many hon. members will recall the predictions which were made during the depression of the 1930's that the small retailer, under the fiercely competitive conditions which prevailed then, would be forced out of business by the chains and the departmental stores with their mass purchasing power; and the situation the small merchants then faced, as we all know, was one of the principal reasons for the setting up of the price spreads inquiry at the instance of Hon. Harry Stevens. If there were to be a

serious decline in the position of the independent retailer, surely it would be expected that this would be most evident during the decade between 1930 and 1940 when our economy at all levels was subject to the most severe strains, and when not only the little fellows but many of the big fellows were going into bankruptcy and receivership. When the census was taken in 1941, however, it was found that instead of there being a decline in the position of independent retailers, they had a larger proportion of the total retail trade in 1941 than they had in 1930.
The figures for 1930 and 1941, and the figures for 1949 based on a sample of independent retailers, are as follows: Independent retailers in 1930 had 68-8 per cent of the total business in Canada. In 1941 that 68-8 had risen to 70-3 per cent, and in 1949 it had risen again to 72-8 per cent. The chain stores started out with 18-3 per cent in 1930; they had 18-7 per cent in 1941 and 17 per cent, a small decline, in 1949. The departmental stores, including the mail order stores, began in 1930 with 12-9 per cent, which sank to 11 per cent in 1941, and sank further to 10-2 per cent in 1949. After quoting these 1941 and 1949 figures the Canadian retail trade federation brief goes on to say:
It is quite apparent that the smaller retailer in Canada is effectively maintaining his competitive position.
I do not advance these figures to suggest that a fixed position has been reached in retail trade, or necessarily to prognosticate that that growth in the independent retailer's share of the business will necessarily continue, because as we all know in the type of economy in which we live changes take place. It is a dynamic economy. New and better ways are found to do things, and they all have their impact upon chain stores, independent retailers and department stores. I do present these figures to show that where retailers operate efficiently in a competitive market they are in no danger of disappearing, and I think all members will agree with me that no more difficult conditions could be found than those experienced during the thirties.
Of course the argument in relation to these figures, and the widespread tendency amongst retailers themselves, is to regard their present prosperous condition as being, to a substantial degree, the result of resale price maintenance practices. I do not think they could claim that as the basis for the increase in 1941 over 1930, because from my observation it seemed that under the stress of depression even resale price maintenance collapsed. But I do not admit that the present position is in any substantial measure
Combines Investigation Act the result of resale price maintenance. Upon a moment's reflection most of the members, those who approach the matter with an open mind, will agree that this is most unlikely, to put it mildly. Fundamentally the welfare of the retailer, along with other economic groups in the community, is intimately tied up with many important economic phenomena, each one of which has an impact upon his position. It is tied up with the level of prices prevailing in our export markets, which in western Canada at any rate is a very important consideration in the prosperity of the independent retailer. It is tied up with the rate of growth of the economy arising from the development of new industries; with the opening up of new natural resources; with the soundness of monetary and fiscal policies pursued by the government-I forbear the temptation of drawing any comparison between the policies of the thirties and those of today.
When these factors function favourably, all classes in the community enjoy a high level of material well-being. If they function adversely, then the whole community is likely to suffer a decline in its living standards and a decline in its net profits which will have, in my view, a much more significant effect upon the fate of the independent retailer than any amount of resale price maintenance. These factors I have named are the fundamental factors behind the prosperity which all groups in the Canadian economy are now enjoying. Indeed, so far as resale price maintenance has made possible, and I think we have to admit that it has in some cases, a higher per unit mark-up on unit sales, it by no means follows that this has necessarily operated to the profit of the retailer. Profit, I suggest, is the result both of volume of turnover and the profit margin per unit. He would be a brave or reckless man who would insist that lower prices would not lead, and have not led in post-war years, to a substantial increase in turnover and therefore probably to a higher profit.
In proof of that we have only to look around us to the great Ford industry. It was built by a man who believed in turning out a product which, in its initial development stages, he priced at lower than he could produce it for at that initial volume, in the expectation that the low price would produce the larger volume. He built a great industry and made himself a multimillionaire by that reasoning. This is the very antithesis of resale price maintenance. It is perhaps natural for many retailers to regard resale price maintenance as offering to them an important degree of protection, particularly when this view is so assiduously promoted by the trade
2104	HOUSE OF
Combines Investigation Act organizations by which it is generally proven that, without resale price maintenance, prices would be determined amongst the distributors oy competition. Now when prices are determined by competition the competition necessitates the individual retailer watching his cost very closely and working out his selling prices on the basis of competition.
When resale price maintenance comes along and relieves the retailer of this burdensome business of watching costs or watching his price mark-up, and assures him that if he is not doing it none of the other people in the business are doing it either, it lulls him into a false sense of security. What he too often fails to see is that this is a curtailment of his freedom to determine his own pricing policy while limiting his ability to alter that policy as conditions may require. If he gets in a position which is different from the market conditions of today, when there is less purchasing power and it is more difficult to make sales, how can he modify his pricing policy at all under resale price maintenance in order to meet those changing conditions? Moreover, resale price maintenance, which holds the same umbrella over the just and unjust, over the inefficient and efficient, does not protect any of them against the entry of newcomers, including co-operatives, into their market, who attracted by stable margins and prices, slowly but surely cut down the volume of trade for each retailer, while at the same time, with the only competition available under resale price maintenance, that of expenditures upon services, make his costs rise. Sooner or later the declining sales and rising costs whittle away the security he thought he had and the protection he believed was being provided for him by resale price maintenance. The time taken for this effect of price maintenance to be felt varies from trade to trade. In those to which entry is comparatively easy the effects will ordinarily be quickly felt, but in those few businesses in which professional training limits numbers, the effects may be long delayed.
I would like to bring to the attention of the house an example of how it works under a well-established system of resale price maintenance, even in a trade in which professional training limits the number of those who can enter. In this connection I should like to quote from a letter by the secretary of the British national pharmaceutical union published in the American journal, Drug Trade News for September 13, 1937. The date is a little old, but the point it illustrates is very apt to my argument. It must be remembered that at that time, in 1937, resale price maintenance had been prevalent to an increasing degree in England for a period of


thirty-eight years. This is what the secretary of the British pharmaceutical union stated:
In our country all proprietary medicine vendors have to be licensed and we woke up to the fact that the number of those vendors was increasing at the rate of eight to nine thousand per year. It is a fact that owing to the success of the price maintenance movement initiated . . . thirty-eight years ago, the prices of proprietary medicines are in fact maintained and the 20 to 30 per cent profit which those articles yield has proved a tremendous temptation to other shopkeepers to invade the proprietary medicine business . . . Hence you will see that the success of our own war to prevent price cutting within our own ranks has produced an army of competitors in our own business.
I cite this as an example of what the next step in the development of this process is. What are the remedies when the retailer, who has been dependent upon resale price maintenance to protect him, finds that protection is false and illusory? What is the next step to remedy that situation? The secretary gives the answers to these questions as follows:
My own organization decided that it would be reasonable to ask manufacturers of proprietary medicinal and surgical goods to restrict their channel of distribution to the chemists' trade. We ask the proprietors of these articles to sign an agreement for seven years, undertaking only to sell these goods through chemists. In return we, on behalf of the chemists, undertake to give those goods . . . the utmost possible sales assistance . . . On the other side, we ask all our members to refrain from giving window, counter or other displays of any kind to the goods or advertising material of any article within our specification which is not upon our list.
Is that the desirable end result that we seek to achieve in this country?


Gordon Graydon: To whom was that
addressed?


Stuart Sinclair Garson: That is a letter from the secretary of the British national pharmaceutical union, published in the American journal, Drug Trade News, for September 13, 1937.


Mr. Adamson:: Signed by whom?


Stuart Sinclair Garson: By the secretary of that organization.


Agar Rodney Adamson: What is his name?


Stuart Sinclair Garson: I have not the name; but 1 could get it for the hon. member.


William Joseph Browne: Who issues those licences?


Stuart Sinclair Garson: I am not sure. I think probably it was the pharmaceutical associations. Would that not be correct? If they had a professional association, it would be that association. Otherwise it would be the government. It will be noticed that in this dilemma, instead of attributing his difficulties to resale price maintenance itself, this secretary concludes that more resale price maintenance, or

wider margins on price maintained lines, is the only effective solution. Thus the demand for resale price maintenance becomes more insistent, and the practice is extended to more and more products. The marginal dealer's existence is-what shall I say-prolonged, but it is not assured by any means. And the whole process goes on at the consumer's expense.
It has been suggested by those who oppose the bill that independent retailers cannot compete, that they cannot exist without resale price maintenance. I suggest that does not follow at all. I have here statistics submitted on behalf of one of the bodies opposing the legislation, which prove that point and prove it conclusively. In the brief submitted to the joint committee by the Ontario retail hardware association there is a table, known as table No. 2, appearing at page 790 of the report of proceedings, and this table gives the figures on comparative efficiency in independent, chain and department stores. The important feature of the table, for our present discussion, is the material on operating expenses and net profit. The data for department and chain stores relate to experience in the United States and for the independent hardware stores to experience in Canada. The gentleman who introduced the material was frank in saying, and quite correctly, that he could get this data in the United States but it was not available in Canada. However he said he had good reason to believe that the Canadian data was of the order of the American data. The following table will serve to give the information about which I
have been speaking:	Operating	Net
	expenses	profit
	per cent	per cent
Dept, stores U.S.A. 1949 		.. 32-5	2-7
Chain variety stores U.S.A. 1943 28-60		7-72
Hardware stores Canada, .1950	.. 20-9	6-2
It will be noticed that the operating expenses in hardware stores in 1950 was not 32-5 per cent or 28-60 per cent, but was 20-9 per cent. That is a difference in operating expenses of 12 per cent. And the net profit figures, it will be noted, were 2-7 per cent in department stores in the United States in 1949; 7-72 per cent in chain variety stores in that country in 1943, and 6-2 per cent in hardware stores in Canada in the year 1950. The percentages in the table are expressed as percentages of gross sales.
It is apparent from these figures that the independent merchant stands in a quite strong competitive position. It is true, as counsel for the Ontario retail hardware association argued before the committee, that the large
Combines Investigation Act departmental and chain stores have an advantage in buying from the manufacturer, in that they order in larger quantities. But, in the words of Mr. Dunn, the lawyer who represented this organization, "it more or less evens out."


Donald Methuen Fleming: What page is that?


Stuart Sinclair Garson: About page 30 of the proceedings. I am afraid I have not the exact page number.


Edmund Davie Fulton: Does the minister mean page 30 of their brief?


Stuart Sinclair Garson: No. The brief was submitted, and then Mr. Dunn proceeded to give evidence based on the brief. In the course of doing so he made these remarks to which I am now referring.


Donald Methuen Fleming: That is nowhere near page 30.


Gordon Graydon: Perhaps it is page 30 of the minister's speech.


Stuart Sinclair Garson: No; my hon. friend is doing me less than justice. It is only page 27. My hon. friend can check this, but I am sure he will find it is correct. Mr. Dunn said:
It more or less evens out. The big store buys cheaper and has a much larger gross profit but the big store has a higher operating cost. Therefore, when it comes to the end the net profit of the big store is 2-7 per cent.
I will complete the comparison-against the net profit for the independent Canadian hardware dealer of 6-2 per cent, or nearly three times higher.
In this connection I do not think it should be overlooked that a great deal of our thinking on this subject has been conditioned by the depression ideas of the middle 1930's. Undoubtedly manufacturers who were hard up to get any kind of order were unduly impressed by the mass purchasing power of these big retail organizations and perhaps made improper price concessions to them. The price spreads inquiry indicated that these goods were purchased at a low price and then sold at a price which was most attractive to the consumer, but which was pretty difficult for the smaller retailer to meet at that time.
However, I would point out that the factors which prevailed in the 1930's, of a glut of goods on the market with a great deficiency of purchasing power, both signs of severe deflation, are now almost exactly in reverse. We are in error and we produce fallacies when we apply to the very much changed conditions of today reasoning which would be appropriate to the conditions of the 1930's.
I submit that the changes which have taken place are calculated to make the competitive position of the independent retailer comparatively stronger and that of the large

Combines Investigation Act chain and departmental stores comparatively less strong as of the present time. In the first place, I do not think there is any doubt at all that the large departmental stores are not able to drive the hard terms with the manufacturers that they did in the 1930's, so they do not get their supply of goods at as low prices in the first place. Then it is very obvious that the operating expenses of the departmental and chain stores, due among other things to increased labour costs and increased taxes, have increased at a faster rate on the average than those of the independent retailer. Unless he is incorporated, the independent retailer pays no corporation tax, a tax which is now over 50 per cent, and having regard to the personal part he plays in the conduct of his business his labour costs are likely to be lower. The independent retailer also has other advantages. As we all know, one advantage he has at all times is that many people would much prefer to pay something extra for the local convenience and the pleasure of getting personal service from a man whom they know.
In this connection I should like to make reference to a matter which was raised the other day by the hon. member for Oxford (Mr. Murray). The hon. member brought me a letter from a constituent who holds a prominent position in the business life of Ingersoll, Ontario. That gentleman made what seemed to the hon. member and to me an important point. That is, that under present conditions, with the operating expenses of the large stores at their present relatively high level, if the small independent retailer was not under too great a handicap in buying his supplies from the manufacturer, if he could get a price which was reasonably comparable with that paid by the large store, he could hold his competitive position with the large stores.
When the hon. member brought that letter to me he said, "I think my constituent has a good idea," and I said, "Well, I think it is important also, and others have thought that it was important." The Stevens price spreads committee of the middle 1930's saw the importance of that very idea and it was carried into the statute law of the country in the form of section 498A of the Criminal Code, which I should like to read to hon. members to show how closely that fits the point raised by the gentleman in Ingersoll. Section 498A reads:
Every person engaged In trade or commerce or industry is guilty of an indictable offence and liable to a penalty not exceeding one thousand dollars or to one month's imprisonment, or, if a corporation, to a penalty not exceeding five thousand dollars, who

(a)	is a party or privy to, or assists in, any transaction of sale which discriminates, to his knowledge, against competitors of the purchaser in that any discount, rebate or allowance is granted to the purchaser over and above any discount, rebate or allowance available at the time of such transaction to the aforesaid competitors in respect of a sale of goods of like quality and quantity.
I think that covers the case which was raised as closely as any statute could. As hon. members know, this is the section of the Criminal Code which was added as a result of the price spreads inquiry. That takes care of the case in which a large dealer is put in the position where he can cut prices by getting a special discount from the manufacturer. Then clause (b) reads:
(b)	engages in a policy of selling goods in any area of Canada at prices lower than that exacted by such seller elsewhere in Canada, for the purpose of destroying competition or eliminating a competitor in such part of Canada:
If one of the large transcontinental organizations goes into one town and starts quoting predatory prices to put a competitor out of business, they would come within that section. The next paragraph reads:
(c)	engages in a policy of selling goods at prices unreasonably low for the purpose of destroying competition or eliminating a competitor.
I think the retail trade itself realizes some of these facts. I should like to quote from the April 1951 issue of the Ontario Retailer, published by the Retail Merchants Association of Canada (Ontario) Incorporated. This issue contains an article entitled "Is the Independent Retailer Too Modest? The Story of the Timid Giant." This article reads in part:
Once upon a time there was a Timid Giant. He was more than three times as big as the next largest giant and yet, believe it or not, he used to refer to his rival as the Big Fellow. He used to watch everything the Big Fellow did in fear and trembling and when he heard that the Big Fellow had actually grown an inch, he got into such a panic that he almost died on the spot. And that is no fairy tale either-although you might call it a parable.
To cut out the fantasy and get down to figures, here are some extracts from the dominion bureau of statistics report on the retail trade for 1949- the latest complete figures available. It states that Mr. and Mrs. Consumer spent a total of $8,427,900,000 in all the retail stores across Canada during that period. Of this impressive total $6,137,990,000 went through the cash registers of independent retailers, and $2,289,910,000 through departmental and chain stores.
Percentagewise that means that the independent retail giant did 73 per cent of the retail business, and the big fellow did 27 per cent. Surely that is not a situation that should develop an inferiority complex in the independent retail trade. But do you refer to the department store and chain store operators as the big fellows, and do you watch their operation in fear and trembling? We are not advocating a feeling of complacency bv any means. The disturbing fact is that the big fellow is growing by inches over a period of years and the

independent retailer either as an individual or a group cannot afford to sit back and rest on his laurels. But we see no cause for panic.
The author of this article goes on to point out ways-and I think I should refer to them-in which the independent dealers can undertake joint actions to plug such chinks as there may be in their competitive armour. But it is a matter of historical fact that after the temporary consternation experienced by independent retailers in the early days of the chain stores, there followed a program of improved merchandising methods through the betterment of stores, in some cases through the formation of various types of voluntary chains and so on, which has placed the independent retailer in a strongly competitive position. I would suggest that it is grossly pessimistic to believe that he cannot meet the current marketing problems without the deceptive crutch of resale price maintenance.
One of the arguments brought against this legislation was that but for resale price maintenance many independent retailers would be wiped out by the practice of loss leaders. At the very beginning of any discussion of this item I wish to make it entirely clear that the use of predatory price cutting tactics with the aim of driving competitors out of business and establishing a monopoly is contrary to public interest. I just finished reading the legislation against it a moment ago. But price cutting of such obviously predatory character is, I suggest-I was going to say "comparatively rare"-but I think it is exceedingly rare nowadays. It would be almost impossible to find an example of it. The fears which nowadays we hear expressed about loss-leaders, the fears that are the basis of the arguments which were used against this legislation, apparently refer to something less, including any noteworthy reduction in price which is widely advertised in order to attract customers to a particular store. One witness, prominent in the retail trade, before the joint parliamentary committee went so far as to define a loss leader in these terms:
I think if I were to give a personal definition of loss leader the closest I could come to it would be: a loss leader is a price which does not represent the full mark-up, and which is designed to attract traffic into your place of business.
It was argued that accompanying this legislation we should have legislation which would bar loss leaders defined in those broad terms. If that is the case we might just as well not pass this legislation.
Here are some other definitions: The sale of merchandise below its net invoice cost to the merchant, with or without cash discounts; the sale of merchandise below net invoice cost plus a percentage equal to the average
Combines Investigation Act operating cost of the merchant, or of the trade; or simply the sale of merchandise at less than its usual retail price. The purpose in all these cases is to attract the customer into the store by means of a loss leader and then make up on the swings the prices of which are not cut for what is lost on the roundabouts or loss leaders that are.
In all these arguments it is assumed that resale price maintenance by eliminating loss leaders will be more favourable to the small merchant than it will be to the chain or departmental store. But this is another conclusion that is by no means necessarily well founded. A study of retail distribution in Great Britain made by Mr. Henry Smith and published by the Oxford university press- and Mr. Smith was a member of the Lloyd Jacob committee in Great Britain and therefore an authority on the subject-points out that "the highest proportion of multiple shops is to be found in the druggist's trade . . ." that is, in the trade in which price maintenance is most thoroughgoing and has been in force for almost half a century. Incidentally it is the same trade concerning which I related the remarks of the secretary of the British pharmaceutical association as to the sorry plight into which it had got under resale price maintenance.
Then there is another development in this connection which I think is not without significance. In the early stages of their growth the chain stores in order to attract customers into their shops indulged in aggressive price reductions in nationally advertised branded lines. In the early stages this was effective because there would be only one chain store in a city block surrounded by a number of independents. Now, however, when the chain stores have to face the competition of other chains it will be noticed that while they do reduce prices the extent of the reduction is nowhere as great as it was in the early days, and the experience in the last five or six years in the United States is that every time there is any move to secure or strengthen the fair trade laws the chains can be found in the vanguard making a great contribution to the necessary costs and taking a prominent part in all proceedings. Why? Because in the first place they cut nationally advertised lines and made up for it in selling their own brands, and then they discovered that under resale price maintenance, where nationally branded lines were maintained, they could make their profit on them and cut their own brands which the independent retailer could not even duplicate at any price.
2108

Combines Investigation Act
May I say-and I am sure hon. members will be relieved when I add "in conclusion"- that there are only three ways in which the prices of goods can be fixed.
The first is by competition. A witness before the joint committee told us that as to the great majority of goods in Canada their prices, their wholesale and retail mark-ups, were determined by competition. For example, this is the case with over 95 per cent of the grocery trade and over 92 per cent of the hardware trade.
The second way is by government control. I think most of us agree that in our free Canadian economy government interference in business should be kept to a minimum and therefore price fixing by the government should be avoided if possible.
The third way that prices can be fixed is by the control of private interests either in the form of (a) price fixing combines, which are quite illegal and indeed criminal under the existing law, or (b) by resale price maintenance which in certain forms and under certain circumstances is also illegal under the existing law. It is for the purpose of making all forms of resale price maintenance illegal that the present bill is being introduced.
I suggest that if this parliament and this government allow price competition amongst wholesalers and retailers to continue to be eliminated by resale price maintenance in certain trades, we shall have to answer four vital and searching questions by the Canadian consumers and by the many hundreds of thousands-some people will say millions- of little fellows amongst these consumers. These consumers being largely unorganized and unprotected, are forced to look for justice in this matter to this parliament and this government. Judging by what some of them have written and told me, I think this is what they are saying to us: We are little fellows ourselves, so naturally we are on the side of the little fellow in the retail business. All we ask is that he work as hard and plan as carefully as we must do in our walk of life. But is there one good reason why the independent retailer, the little fellow, who will not take the trouble to make himself reasonably efficient-not extremely efficient; just reasonably efficient-should be protected under resale price maintenance by profit margins which, at our expense, will provide for the reasonably efficient merchants profits which they do not need, and in some cases do not wish to take, but which resale price maintenance compels them to take? That, they would say, is question No. 1: Is there one good reason for this sort of protection?
Then I think they would say to us: Our second question is this. Can anyone bring

forward a reason why the little fellow in some trades needs heavy protection from resale price maintenance whereas in the grocery and hardware trades, for example-and there are others-the independent dealers, including all the little fellows, when they are reasonably efficient have demonstrated for many years that they can keep their share of the retail trade and the profits in it, against all competition?
The third question they would ask is this: If the government will not control prices itself, is there any good reason why wholesale and retail profit mark-ups should be left to a substantial extent under the private control of manufacturers?
The fourth and final question which they would ask of this parliament is this: Is it reasonable to expect the Canadian people as consumers to tolerate indefinitely the practice of resale price maintenance whereby the cost of distribution of goods and the prices of the goods themselves are fixed by the manufacturers without the safeguard of price competition amongst wholesalers and retailers?
These are all very just questions. They are all questions to which the men and women in Canada who are consumers are entitled to an answer. In the government's view the answer to every one of those questions is: No, there is no good reason; and these negative answers, in- our view, constitute one of the strongest arguments in support of the present bill.
This bill proposes to make it an offence for a manufacturer or a dealer to prescribe fixed or minimum resale prices. He may still prescribe and enforce maximum resale prices. He may also indicate resale prices as long as he does not do so in such a way as to require or induce another person to maintain them. The man who wishes to be law-abiding in this regard, I suggest, will not have any trouble at all in avoiding any action which could be interpreted as requiring or inducing another person to maintain prices.


Edmund Davie Fulton: Mr. Speaker, it is now quite obvious that the government is certain that it is not wise to proceed with this legislation. We have just observed the spectacle, for the last two and a half hours, of the Minister of Justice (Mr. Garson) doing his best to talk out his own bill.


Some hon. Members:: Oh, oh.


Edmund Davie Fulton: The whole course followed by the government in connection with this legislation has been as extraordinary as has been the spectacle we have just witnessed. That they themselves are unconvinced of the merits of the bill and that, if they press it through

to a conclusion, they are doing so for nothing more than party political purposes, was nowhere more clearly demonstrated than in the tactics they have followed during the whole of this session. At every turn since the beginning of the session in October they have attempted to choke off discussion on the merits of the proposal to outlaw price maintenance.
The speech from the throne announced the proposal to bring in legislation at this session. Nothing was done about that matter and no further reference was made to it until the beginning of November, when it was announced that it was intended to refer it to a committee. The committee was not set up for a week after that announcement was made. The committee's sittings were limited. An artificial termination date was placed upon them. The evidence which that committee was allowed to receive and consider was curtailed. But most reprehensible of all in connection with this extremely important matter has been the delay of a whole week at this stage, after the presenting of its report by the committee and the reference of the matter back to the house a week ago last Friday, before proceeding with this legislation in the house in the obvious hope, Mr. Speaker, that the approach of Christmas and the human desire on the part of the members to rejoin their families would have the result that those opposed to the legislation-and I may say that they are to be found on both sides of this house-would be induced to leave; and thus the bill would, they hoped, enjoy in the house that cursory and inadequate examination only which the government majority had allowed it in committee, and its passage would, they hoped, be expedited.
Never was a more serious and far-reaching step affecting some 700,000 Canadians directly engaged in or dependent on the retail trade more summarily and inadequately treated- and thus treated for political purposes only. Indeed, Mr. Speaker, the anxiety of the minister not to deal with the merits of the matter in the house but to play politics and to build up political pressure outside the house was nowhere more clearly demonstrated than in the fact that, even after this long delay before bringing the bill back into the house and dealing with it, his speech of this evening was reproduced in the press before it was delivered in the house.


Stuart Sinclair Garson: I rise on a question of
privilege. I am glad my hon. friend has raised this matter; in fact I wondered whether I should not do it myself. This speech was prepared and was handed to the press today, with the usual condition that it was not to be released until delivery. That condition was observed, so far as I know by
94699-134*
Combines Investigation Act all the members of the press gallery with the exception to which the hon. member refers. I therefore do not think that my hon. friend can hold me accountable for what has taken place.


An hon. Member:: A Tory paper.


Edmund Davie Fulton: I am not holding the minister accountable for whether it appeared in one paper or not. I am merely referring to the fact that the whole course of action followed by the government with respect to this legislation has had the result that the matter has been dealt with on a political basis in the country before there was ever an opportunity for discussion on the merits in the house because its introduction here has been held up in the hope Christmas would take members home so the bill would slip through. I think what the minister has just said verifies that statement.
As to the minister's speech itself, I shall not follow him in all of the extraordinary mental convolutions, if I may use that term, which he has followed. I would say that his whole speech was characterized by the last four questions with which he concluded, and which he said the consumers of Canada would be asking. About that time, Mr. Speaker, one began to doubt if the consumers would even get an opportunity to say a word let alone ask a whole question. But these questions can be characterized as nothing more or less than trick questions. Indeed, while it was a lengthy and, I would say, a laboured speech, it was in fact a trick speech. When you analyse the speech and the points made by the minister and compare them with the evidence which was actually submitted -that is, such evidence as we were allowed to have brought before the committee-you will find that the facts upon which those points are based, like the facts upon which the questions are based, are not correct. It was a highly selective speech in its choice and presentation of the evidence. Rather than attempt to follow further the speech itself and the course which the minister took in dealing with this subject, I shall deal with the matter generally and answer the minister's points in the course of my own analysis of this problem.
Much has been made in the course of the discussion, both in and outside the house, of the effects which it is alleged this legislation is going to have upon the cost of living in Canada. I suggest that in the legislation before us today we can see evidence, when we view it in that light and when we ask ourselves just what effect this is going to have on the cost of living in Canada, of the government's impotence and inability to deal

Combines Investigation Act with that problem. We are presented with this bill as the government's contribution towards reducing living costs, the one and only solution offered by the government at this session, when their major responsibility should have been to take effective action to deal with this problem. Considered as a solution, as a contribution, as an answer to a problem or as anything more than shadowboxing with the cost of living, it is a sputtering and fizzling farce.
But if it were only that, if it were nothing more than that, then we could be done with it by laughing it to scorn for the poor inadequacy it is. But unfortunately, obvious though it is that this measure is intended to delude the consumer into thinking something is being done about the cost of living, of itself it will have little or no effect in that field, as the Prime Minister (Mr. St. Laurent) has agreed. Yet it is positively a dangerous and improper piece of legislation to be enacting now because of the threat it presents to the existence and welfare of the small independent retailer. Indeed, the absence of any evidence that would justify the statement that it will reduce the cost of living, coupled with the existence of positive evidence that the legislation is desired by some of the largest and most powerful business interests in the country, and is opposed by thousands of small business men, supports the conclusion that the bill is so designed that it will accomplish nothing more effective than to increase the power and competitive advantages of the large chain and department stores at the expense of the small retailers.
As such it gives every impression that the government has produced a piece of legislation which will promote special interests and advance the welfare of some of their friends in the field of big business, without any corresponding benefit to the consumer, but to the peril and increasing disadvantage of the smaller, weaker independent retailer who is less able to take care of himself. Because we are unable to subscribe to such an unfair and prejudicial course; because we believe the independent merchant is a vital part of our economy; because we prefer a larger number of independent businesses as being in the best long-run interests of the consuming public and of the nation, as opposed to an increasing concentration of power in a small number of monopolies; because we consider this legislation ill-considered, hasty and unfair, we propose that it be not proceeded with, and I intend to move an amendment accordingly.
But first may I mention some of the more objectionable features surrounding the present legislation. In doing so I wish to
fMr. Fulton.]
emphasize that we are not taking a strong position either for or against the merits of the price maintenance system as presently practised. Indeed, one of our strongest objections to the course now being followed by the government is that resale price maintenance is being disallowed without sufficient evidence as to whether it is, in fact, harmful or beneficial in its results to the consumer. We do not know from any evidence already before us, because we were not allowed sufficient time to get evidence, just what its effect is on prices.
We did not have sufficient evidence to enable us to say whether it is desirable or undesirable in theory, let alone in its present effect on prices and upon the economy generally. But we did have available very positive evidence that the vast majority of independent retailers are fearful of the results in terms of unfair competition, loss leaders and increasing power in the hands of the big chain department stores, which will result if price maintenance is eliminated.
It is true, Mr. Speaker, that one or two of the very large chain departmental stores- Eaton's is the conspicuous example-said they were opposed to the practice of price maintenance and in favour of the government's legislation. But we had no evidence that any small retailer supported Eaton's stand. As I have said, they were all genuinely concerned over the vastly increased powers which would be given to the giants such as Eaton's if the protection of price maintenance were taken away. If there were nothing else but the fact that Eaton's is in favour of the government's proposal and the little man is opposed to it, I would proceed with caution, if not with suspicion. Without going any further into the merits or demerits of price maintenance itself, I say we have not sufficient evidence to justify us in enacting this legislation eliminating price maintenance, bearing in mind that it will place the small man at the mercy of the big fellow without giving him any alternative protection.
This refusal to allow us to get evidence was persistent and extraordinary. In fact, it was such as to go a long way towards confirming my suspicion, referred to already, that this legislation is calculated to help the big fellow. Even after Eaton's had come out against price maintenance in a well publicized brief which was circulated in advance to the press, the government consistently refused to let us call any witnesses from that concern to state why they were so much in favour of the government's proposal. Not only did they refuse to allow us to call evidence from the big men-I should point out that the one

I have named is not the only one-to ask them to justify their position, but they consistently refused to allow us the time and opportunity to call witnesses from the small retail trade who desired to be heard, or to get evidence in facts and figures from the retail trade as to the results of price maintenance, which would establish whether or not the practice worked to the advantage or to the detriment of the consumer.
We are opposed to proceeding in this manner with legislation which condemns the small retailer and deprives him of his only means of protection against the chain store and the mail order department store without having had sufficient evidence to justify such a course, and particularly without having given the small retailers of Canada a fair hearing. For the retailers of Canada, Mr. Speaker, the independent merchants, will be condemned without a trial if this bill passes, because by this bill now before the house the government proposes to condemn them practically unseen and unheard.
I have spoken of the lack of evidence and the refusal of the government to grant us the opportunity to obtain evidence. Mr. Speaker, I wish to make it perfectly clear that the lack of evidence to support the proposal now before the house is in no way the fault of the official opposition. We pressed repeatedly in the committee for the right to call witnesses and to question those witnesses on all subjects, whether they were included in their brief or whether they were in their general knowledge as people with an intimate knowledge of the retail trade of Canada. But a glance at the proceedings, both in this house and in the committee, will show the inadequacy of the consideration given to this matter and the folly of passing legislation of this kind with so little evidence.
This is a big subject, Mr. Speaker. The Minister of Justice (Mr. Garson) himself, in the course of his remarks tonight, made that as one of his main points. He said: "This is not a simple subject," one of the few conclusions in which I could agree with him. It is far from a simple subject. It affects directly at least 700,000 people who are either engaged in or immediately dependent upon the retail trade of Canada. It is going to have a profound effect on every one of these people, and it may have a more considerable effect on the economy of the country generally, quite apart from its effect on the retail trade.
What consideration has, in fact, been given to this matter? What evidence do we have that there has been sufficient consideration? What evidence do we have of the facts and figures of the results that flow from the practice of resale price maintenance upon
Combines Investigation Act which we are asked to base a conclusion, and now to translate that conclusion into legislative form, absolutely outlawing and banning the practice? Well, not to go too far back-the minister went back into history, but I do not intend to follow him all the way- there has been particularly the MacQuarrie committee which is relied upon by the government as the main basis upon which they say this legislation should be enacted.
When one looks into the consideration which the MacQuarrie committee gave to this matter very serious doubts are raised as to whether that committee itself had sufficient time to give the matter the consideration it deserves, and whether they gave themselves sufficient time to justify the conclusions at which they arrived. I call to witness first the Minister of Justice to establish that the MacQuarrie committee had by no means finished their investigation when they were asked suddenly to present the interim report upon which this legislation is in the main based. Speaking in the house during this session on November 2, the minister said, as reported at page 664 of Hansard:
It therefore became clear some time ago that the MacQuarrie committee could not hope to finish its work until the end of the present calendar year at the earliest.
There is no suggestion that the MacQuarrie committee-and if there is a suggestion, there is certainly no evidence upon which the suggestion is based-had in fact completed and concluded in every way their study of the question of resale price maintenance, or of the general subject which was referred to them, when on September 10 the minister wrote them a letter in which he asked them to make a report with respect to this question of price maintenance. That report, Mr. Speaker, in spite of the fact that the minister said it was clear the MacQuarrie committee had not finished its work, was produced by October 1, just twenty days after the committee was asked to report on this matter. That report, Mr. Speaker, contains no evidence; it is nothing more than a collection of opinions; and indeed from the evidence we heard at the parliamentary inquiry into this matter, it became very doubtful as to whether or not the MacQuarrie committee had in fact received anything more than an expression of opinion. Whether they had asked for or been presented with any facts or figures upon which to make a statistical analysis which would justify them in their conclusion that price maintenance as a practice is against the best interests of the Canadian consumer is, to say the least, extremely doubtful. All that appears in their interim report is a collection of opinions, and from

Combines Investigation Act appearances they simply added up the opinions for and the opinions against and subtracted one from the other, and came to the conclusion that "the ayes had it."
That is not my own opinion only, Mr. Speaker, with respect to the adequacy of the evidence before us and its efficiency as the basis for the legislation we are now asked to pass. I would refer particularly to the opinions of the Trades and Labour Congress of Canada, as presented in a brief to us and as substantiated by Mr. Percy Bengough, the president of the trades and labour congress, in his evidence before the committee. The brief of the trades and labour congress, which incidentally I should say here and as will appear in more detail later as we analyse the evidence that we were allowed to get, did not take a strong position opposed to the practice of price maintenance-


Mr. Sinclair:: They certainly were not for it.


Edmund Davie Fulton: That will appear more particularly later. They certainly did take a very definite position that the MacQuarrie committee's report was not a substantial basis upon which to condemn the practice. I will read from page 380 of the proceedings of the committee, where after referring to the question of whether or not the factors mentioned by the MacQuarrie committee justified their conclusions, they say:
No concrete evidence has been produced in the interim report to show the real influences in this regard and in the absence of such facts your committee is, in essence, acting in the dark.
That of course, Mr. Speaker, as it turned out, became more and more apparent the longer the committee sat; because the more it became obvious that in order for us to be able to make an intelligent conclusion on this subject we must have statistical evidence, the more determined the government became to deny us every opportunity of obtaining such evidence. The trades and labour congress brief on the same subject says as follows, as reported at page 381:
We have raised these doubts about these matters, not because we favour resale price maintenance as such, but because we are not favourably impressed with the interim report. There is an air of artificiality about the interim report. It states its case and reaches its conclusions without adducing any pertinent or concrete evidence of resale pricefixing practices in Canada. The effect of its vague and quasi-technical exposition is to suggest that it is merely a contrived argument to support a preconception.
It was upon the basis of that report, whose very form suggests that it was merely "a contrived argument to support a preconception"-and that is the considered opinion of the largest and most responsible labour organization in Canada-that the government committed itself in the speech from the throne

to introduce legislation outlawing price maintenance. And in the same speech from the throne they coupled, immediately after the undertaking to introduce this legislation, the inference that it was designed to reduce the cost of living.
Then, as the Minister of Justice (Mr. Gar-son) himself has confirmed this afternoon, a form of second thought set in as a result of many protests from retailers affected, which the government and others began to receive. So the government decided it would appoint a joint parliamentary committee of both houses of parliament. At this moment I think I should pause to pay tribute to the chairman of that committee, who revealed himself as very able indeed. It is unfortunate that his ability was demonstrated chiefly in his success in preventing the committee from getting evidence. But he was very able in that regard.
But, Mr. Speaker, if this subject, upon which the government said in the speech from the throne that it was proposing definitely to base legislation, was thus suddenly to be referred on second thought to a parliamentary committee, one would have assumed at least that it was intended to give that committee the opportunity to study the merits of the question. After all, if the matter is referred to a committee and that committee is not given the opportunity to study the merits of the question, the only conclusion to which one could come, and the only conclusion which the facts support, is that the government appointed that committee and referred the MacQuarrie report to it for the sole purpose of enabling themselves to evade their proper responsibility, and to have the committee act as a rubber stamp of the MacQuarrie report so that the government, if taxed with its responsibility for the legislation, might be able to say, "Oh, but we referred the whole matter to a joint committee of parliament and it recommended legislation."
That is in fact all that has happened, except that the committee did not act only in the capacity of a rubber stamp. We were allowed to add to our functions that of an adding machine. We were allowed to add up the opinions, both pro and con. We were allowed to add the number of briefs in favour of price maintenance and to add the number of briefs opposed to price maintenance, and to subtract one from the other. Then, having acted as an adding machine, our functions were limited to that of rubber stamping the MacQuarrie recommendations.
Sir, I object most strenuously to this improper use of the parliamentary committee.

I object to the appointment of such a committee on the pro forma basis that it is to have referred to it a committee's report, that it is to consider that report, and then to having the committee's investigation cramped and confined and effectively gagged so that an adequate consideration, indeed any consideration, is made quite impossible.
I have referred to the lack of evidence before the MacQuarrie committee upon which conclusions could properly be based, as well as to the lack of evidence before the parliamentary committee. There were no less than six separate demands by way of substantive motions on the part of opposition members in that committee in an endeavour to obtain evidence which would enable us to reach an intelligent conclusion. Each one of those motions was voted down by the government's majority on the committee.
On two occasions those adverse votes were reversals of previous decisions the committee had arrived at. The procedure was most extraordinary. On two occasions members of the committee, as one would have expected intelligent men to do, had arrived at the conclusion that we should in fact place ourselves in possession of sufficient evidence and sufficient facts and figures surrounding this practice to enable us to reach a proper conclusion. But overnight, after an opportunity for consultation between the chairman and the government which had appointed him, efforts were made-


James Sinclair: On a question of privilege; the hon. member has been carried away by his own opinions. I am sure he will recall that I was elected chairman by the committee.


Some hon. Members:: Oh, oh.


George Harris Hees: Marks for humour!


Edmund Davie Fulton: I also recall that it was the hon. member himself who pointed out to one of the members of the committee that there never had been a parliamentary committee since 1867 on which the government did not have a majority of the members. So it was perfectly obvious that the government would have a chairman of the committee.
However, I think the hon. member is overly sensitive, because what I had said was that, after the opportunity for consultation between himself and the government, he had instituted proceedings and a line of argument supported by the government majority, which resulted in a reversal of that decision to obtain evidence.
One would have thought that in the light of the fact that the government had placed in the speech from the throne the proposal
Combines Investigation Act to bring in legislation, and the proposition that such legislation would have the effect of reducing the cost of living, after they had referred the matter to a committee they would have been anxious to produce evidence to prove that the enactment of the legislation would in fact have the effect of reducing the cost of living.
Well, it became obvious that the government was not anxious to produce that evidence. And so in a desire to get at all the evidence on all sides of the question, and in a desire to force the issue as to whether we would be allowed to reach intelligent conclusions, we moved that all the relevant facts and figures be placed before the committee.
Let me say here, by way of digression, that when he dealt with this subject the Minister of Justice showed an example of that amazingly selective mind of which he is possessed.


Donald Methuen Fleming: That is another word for partisan.


Edmund Davie Fulton: He said that opposition members of the committee had asked for evidence of profit margins on price-maintained and non-price-maintained goods. In fact, he said, statistics on this complicated matter would not justify any conclusion. He implied that, after all, the ordinary member of parliament is not intelligent enough to be able to understand these figures, and that only experts like the members of the MacQuarrie committee-or cabinet ministers-could analyse intelligently any figures which might be presented. He suggested therefore it was not proper that these figures should be placed before the committee.
These were his words:
In most cases the statistical study advocated was a simple comparison of retail margins on price-maintained with those on non-price-maintained lines.
And he went on to say at page 18 of the text he released:
To give a proper weight to each of these factors before arriving at what could realistically be regarded as comparable marketing margins would be a hopeless task.
And he interpolated in the course of expanding his 7,500 word address to approximately 10,000 words that-as I took it down-
Anyone who suggests otherwise has not scratched the surface of this subject.
I do not know how much the minister has scratched; but his argument that all we asked for was a comparison between profit margins on price-maintained and non-price-maintained goods indicates that he has not even read the evidence before the committee. He has not considered the motions which in fact were made asking that evidence be produced.

Combines Investigation Act He has overlooked entirely the fact that our motions asked for a comparison not only of profit margins but of end prices in Canada, not in the United States. We asked for a comparison of end prices of comparable goods, both price-maintained and non-price-maintained.


Stuart Sinclair Garson: Will the hon. member permit a question?


Mr. Hodgson:: He did not interrupt you.


Stuart Sinclair Garson: If he does not permit a question-


Edmund Davie Fulton: I shall be glad to.


Stuart Sinclair Garson: Will my hon. friend tell me
how it would be possible to make a comparison between identical goods sold in Canada under resale price maintenance and those not under resale price maintenance when those sold under price maintenance are sold right across Canada?


Edmund Davie Fulton: The minister's question is about as clear as the four questions at the end of his speech. Our motion asked for a comparison of goods of comparable quality and category in Canada, both price-maintained and non-price-maintained. I think I had better read the motion so that the actual request for information will be before the house. I quote from page 301 of the minutes of proceedings and evidence of the committee as follows:


Edmund Davie Fulton: that the steering committee in conjunction with the committee counsel and the Combines Investigation Act commissioner formulate a series of questions to be put to all manufacturing groups coming before the committee; and in cases where the witnesses wish that the names of the manufacturers producing figures be kept secret, committee counsel and the Combines Investigation Act commissioner sit in with the witnesses in order to assure the committee that the figures are representative.
The minutes then record that:
After discussion, and the question having been put on the said motion, it was resolved in the affirmative.
That was the first motion, on November 26. Then, on November 27 the steering committee reported against that suggestion. In amendment to the report of the steering committee I moved the following motion, and I quote from pages 345 and 346 of the minutes of proceedings, as follows:
That for the purpose of enabling the committee to compare profit margins and cost to the consumer in both price-maintained and non-maintained goods, committee counsel together with the combines commissioner procure from manufacturers and retailers appearing before the committee (as individuals or through their association) figures for typical commodities in the lines produced or handled by them, showing the following stages in (he distributive process:
(1)	the factory cost


(2)	the price to the distributor
(3)	the price to the retailer
(4)	the price to the ultimate purchaser
for price-maintained and non-maintained goods of comparable category and quality; and that with respect to a departmental store or manufacturing concern which does its own manufacturing and distributing the figures be given with the omission of the appropriate stages outlined above;
and that counsel be empowered to employ a cost accountant as and when necessary for the purpose of such study.
After discussion and the question having been put on the said amendment, it was negatived-
There was only one member on the government side who voted for the motion, the hon. member who has been mentioned by the Minister of Justice as being very much concerned about the course proposed to be followed. I refer to the hon. member for Oxford (Mr. Murray). On that occasion the committee reversed its previous decision and decided that it would not obtain evidence of either profit margins or the price to the consumer on price-maintained and non-maintained goods of comparable category and quality in Canada. This decision was reached although one of the witnesses, in fact more than one but especially Mr. Harris, president of the Canadian retail federation, a most excellent witness, advised us definitely that such a study could be made and that his organization would be glad to help in producing such evidence, that is, evidence relating not only to profit margins but to the end price to the consumer of price-maintained and non-maintained lines.
It will be seen that the committee decided definitely by that vote that it would not obtain factual evidence of the only type which would have enabled it to decide intelligently whether or not the system of pi'ice maintenance in fact operates to the detriment of the consumer with respect to prices. After all, it seems to me hardly reasonable to say the least to ask parliament to condemn a practice of such widespread nature throughout the retail trade, the elimination of which is causing such concern to independent retail merchants, without allowing us to get the facts as to whether or not the practice actually raises prices. That seems to me to be asking us to indulge in a course of legislative folly.
After the attitude which government supporters showed in the committee-government supporters led mainly by the Minister of Justice, who was a member, and by the chairman of the committee-of insisting that such evidence would be meaningless and beyond the powers of the members of the committee to apprehend, it is extraordinary to say the least, to note the same minister who said that even if we did make that

full study it could not be of any value to us, now producing the relatively infinitesimal amount of statistical information with which we have been served in the course of his speech tonight, and stating solemnly that the statistics he has quoted justify the conclusion that price maintenance operates to the disadvantage of the consumer. It is a most atrocious contradiction in attitudes. This same minister who said we could not and should not take the time to have these figures produced because we could not understand them and because they would not prove anything in any case now states, according to page 21 of the text of his remarks tonight:
These statistical data-
Based mainly on United States statistics, not Canadian.
-are sufficient to establish two generalizations that hold true, broadly if not universally, of the effect of resale price maintenance.
The minister in charge of these proceedings who told the joint committee of parliament that they should not have figures because they could not understand them and because they could not base any conclusions on them now comes solemnly into this house with two or three American figures and says that "these statistical data" are sufficient to establish the proposition that price maintenance operates to the detriment of the consumer.
The result of that extraordinary mental process and the insistence of the government majority that we were not allowed to have any adequate evidence is that the joint parliamentary committee was not and this house is not in possession of sufficient facts and figures from which to draw any conclusion that price maintenance does in fact operate to the detriment of the consumer. But as though there were not a sufficient limitation placed upon our deliberations by the refusal to allow us to get statistical figures, our deliberations were further stultified by the limitation of the time available for the consideration and study of this problem. A few figures here will, I think, suffice to demonstrate what I have said. Our sittings started on November 13 and concluded on December 7. During that time we held nineteen sittings, of which one was an organizational meeting and the last two were executive sessions. We only had sixteen sittings during which it was possible to hear evidence and examine witnesses. In that short time, sixteen sittings, we were expected to consider forty-two briefs, two supplementary briefs, three briefs by way of letter or resolution, the foregoing being, material which was laid before the committee, making quite an impressive list, in addition to many hundreds of private wires and letters received by members.
Combines Investigation Act For all that mass of information and opinion we were allowed just sixteen sittings to examine witnesses, consider the representations, discuss the problem and arrive at an intelligent conclusion on it. I am not one who shares the rather low opinion that members of the government obviously have of the capabilities of members of parliament but even I, although I do believe we could have comprehended statistical data, certainly do not set our ability so high that I would say we could arrive at an intelligent conclusion on the great volume of matters laid before us within the time which we were allowed to consider them.
In contrast to this general refusal to allow our committee to get any facts and figures on which we might base an intelligent opinion is the attitude of the Minister of Justice (Mr. Garson) that the MacQuarrie committee's conclusions must be accepted because they are a group of experts. That opinion is, I think, completely disposed of when one considers the evidence of three of the witnesses who appeared before the special committee, to the effect that the MacQuarrie committee had neither asked for nor been provided with facts and figures from the witnesses appearing before them to substantiate the simple statements of opinion which they had heard. I refer to Mr. Harris, the president of the Canadian retail federation, Mr. Preston, secretary-manager of the Canadian pharmaceutical association, both of whom said their organizations had neither been asked for nor provided any statistical data to the MacQuarrie committee, and Mr. Fred McGregor, who stated from his knowledge of the matter he considered it proper that the MacQuarrie committee had not had any such evidence
I submit that the facts I have presented establish that we have not sufficient evidence to justify the legislation outlawing price maintenance which we are now asked to endorse. On the other hand we do have evidence that it is extremely unlikely that the enactment of this legislation would have any substantial effect on the cost of living. You see, Mr. Speaker, we are being asked to embark upon this course largely as a result of political pressure which has been built up throughout the country, inspired by the government's propaganda to the effect that if this legislation is introduced the cost of living will be substantially reduced. Against that I would cite the opinion of the Prime Minister of Canada (Mr. St. Laurent), as reported at page 41 of Hansard for October 15, in the course of the throne speech debate. He said:
. . . and again I can say that as regards immediate additional measures to curb inflation, while others


James Sinclair: The Tories wanted him.


Edmund Davie Fulton: That is quite so but we also
wanted others. We are not prejudiced like the government. We did not want to hear only one side of the matter. We genuinely wanted to get all the evidence and information available.


James Sinclair: He was your man and you got him.


Edmund Davie Fulton: We asked for Mr. McGregor and a number of other witnesses but it is significant to note that after Mr. McGregor had appeared and read a brief which was highly favourable to the government they closed off all further witnesses and absolutely refused to allow the committee to call any other outside witness who might have shed any light on the subject.


James Sinclair: He was a Tory witness.


Edmund Davie Fulton: Quite so; he was asked for by us, but it will not be denied-


James Sinclair: A dandy, too.


Edmund Davie Fulton: Perhaps I did not understand the hon. gentlemen. I have said before that Mr. McGregor was called on the initial suggestion of members of the opposition, and 1 have no apology to make for that. But I think there is some explaining to be done on the part of the government as to why, after hearing him, they refused to allow any other witnesses to be called as requested by us.
Mr. McGregor, whose evidence is relied on to such a great extent by the government, makes it quite clear that his opposition to the practice of resale price maintenance is based entirely upon theory, and that it proceeds in no way from any conclusion or

finding of fact on his part that the practice of price maintenance operates to the detriment of the consumer by increasing prices. I refer the house to the evidence of Mr. McGregor, as reported at page 596 of the proceedings of the committee, where I asked this question:
Q. . . . then do I take it that in arriving at your conclusion that it is against the public interest-
That is, the practice of resale price maintenance.
-you divorce from your mind any consideration of whether or not in the long run it operates to reduce prices to the consumer? Do I understand you are simply saying that because it restricts competition it is adverse to the public interest?
A. That is pretty much the basis of my own thinking on it, except that I would add that not every restriction of competition should be regarded as offensive; it must be an undue restriction.
Q. Your opposition to price maintenance as set forth in your brief proceeds entirely from your proposition that it is a restriction of competition, and not at all from the basis that it affects the public adversely from the point of view of the ultimate price to the consumer?
A. Correct, undue restriction of competition is the basis in my opinion.
You therefore see, Mr. Speaker, that it is the definite and unequivocal opinion of the star witness for the government that price maintenance should be opposed not because it has any adverse effect upon prices or that it affects the consumer price-wise, but simply because of his theory that it is an undue restriction of competition.
Together with that fact, Mr. Speaker, I ask the house to consider this significant point. It is in no wise the manufacturer who is responsible for price maintenance. An attempt has been made by the government, through its propaganda, to create the impression throughout the country that this practice of resale price maintenance is brought about by powerful manufacturers' organizations seeking, to serve their own selfish interests only, to gain control over the whole Canadian economy and to grind consumers by raising prices. That is the impression they have sought to create but it is one that is most definitely at variance with the facts; because the evidence-such evidence as we were allowed to get before the committee- definitely tended the other way. Again I rely upon the evidence of Mr. McGregor in this connection, that it is not the manufacturer who wants this, that it is not even the manufacturer who benefits mostly by it, but that it is the small retailers who want it. I ask the house to consider Mr. McGregor's answer as found at page 596 of the proceedings of the committee in reply to this question:
Q. You have also I think referred to the desire of the manufacturers to have their prices main-
Combines Investigation Act tained. Now, as between the manufacturer and the retailer, who benefits most, who wants it most?
A. Unquestionably the retailers.
There was no hesitation or equivocation about Mr. McGregor's answer: Unquestionably the retailers. I therefore ask the house again, Mr. Speaker, in considering this matter, to bear in mind that such evidence as we have not only fails to establish that price maintenance has an adverse effect upon the consumer with regard to prices, or an adverse physical effect upon prices; but that there is evidence that establishes quite conclusively that it will have little or no effect in reducing the cost of living, if outlawed; and furthermore, that it is the small retailer who desires it-and designed it-as a form of self-protection and not the manufacturer who wants it to enlarge his influence.
I see that it is close to ten o'clock. I just want to lay before the house one other consideration and then the amendment which I propose to move, before adjourning the debate. The other consideration with which I wish to deal just for a moment is the question of whether or not there is adequate protection against the practice of loss leaders which are so much feared by the small retailer and by which he feels he will be knocked out if price maintenance is eliminated. The minister says: Well, we will get evidence on this matter, and if any untoward practices develop we will act to meet them. On this subject of whether or not the elimination of price maintenance by the passage of this bill will harm the small retailer the government in effect says: Wait and see. The Minister of Justice (Mr. Garson) has said: Pass the legislation and let us put it into effect; then we will take a good look at it, and if we see that it is having harmful effects on the small retailer, then we will consider some adequate form of protection. That has been said in the committee as well as implied in the house.
This surely is a most irresponsible and callous attitude for a government in charge of the administration of the nation's business to adopt. It reminds me of nothing more than the cases we so often read about in the paper, of the small boy who picks up the gun, pulls the trigger and then, when his father or brother lies dead on the floor, says: I didn't know it was loaded. But in this case the difference is that the government is deliberately pulling the trigger first, not just because they did not know it was loaded but because they had a shrewd suspicion that it was loaded but they thought this was the best way of finding out whether it would have damaging results. What they are saying is the same as if a doctor said: We do not know whether the medicine will cure or kill, but

Combines Investigation Act let us administer it to the patient anyway, whether he likes it or not; and then if he dies, we can always hold a post mortem to find out whether the cure was responsible for the death. [DOT]
For the reasons which I have outlined in part so far, Mr. Speaker, we feel that this legislation is being proceeded with without adequate consideration, that it should be given much more consideration, and that alternative methods of protecting the small retailer must be enacted simultaneously with any legislation eliminating price maintenance. I therefore propose to move,-and the motion will be seconded by the hon. member for Eglinton (Mr. Fleming):
That this bill be not now read a second time but that it be read a second time this day six months hence.
Mr. Speaker, I move the adjournment of the debate.


Some hon. Members:: Question.


Mr. Speaker:: Order. If I now put the
question on the amendment-


Edmund Davie Fulton: No, Mr. Speaker-


Mr. Speaker:: If I read the amendment now, the hon. member for Kamloops will not be allowed to speak further tomorrow. Does he wish me to read the amendment now? [DOT]


Edmund Davie Fulton: No, Mr. Speaker. I thought I had covered that point. I said that I proposed to move, at the conclusion of my address, the following amendment. Then I asked to be allowed to move the adjournment of the debate. I handed in the amendment, I must confess, but perhaps it could just be taken for information purposes.
On motion of Mr. Fulton the debate was adjourned.



BUSINESS OF THE HOUSE

Alphonse Fournier: Mr. Speaker, tomorrow we will continue consideration of this Bill No. 36; and I would announce all the other items on the order paper, without giving the order in which they will be taken because I do not know how long this debate will last.


George Alexander Drew: It will not be necessary to announce anything else.


Alphonse Fournier: Nothing else?


George Alexander Drew: No.


Alphonse Fournier: In case I should be caught, I will announce every other item on the order paper.


[Stage Direction]
At ten o'clock the house adjourned, without question put, pursuant to the order of the house passed on November 2, 1951.
[Stage Direction]
Tuesday, December 18, 1951